Jessica purchased a home on January 1st, 2018 for 710,000, by making a down payment of 280,000 and refinance the remaining 430,000 with a 30-year loan, secured by the residence, at 6%. During 2018 & 2019, Jessica made an interest-only payment on this loan of 25,800 (each year) on July 1st 2018, when her home was worth 710,000 Jessica borrowed an additional 177500 secured by the home at an interest rate of 8%. During 2018, she made interest - only payments on the second loan in the amount of 7,100. During 2019 she made interest only on the second loan in the amount of 14,200. What is the maximum amount of the 40,000 interest expenses Jessica paid during 2019 may she deduct as an itemize deduction if she used the proceeds of the second loan to finished the basement in her home and landscape her yard (assume not married filing separately)

(b) on April 1st, Mary borrowed 160,000, to refinance the original mortgage on her principal residence. Mary paid 1 point to reduce her interest rate from 6% to 5%. The loan is for 30 - year period. How much can Mary deduct in year 1 for her points paid.

(c) on November 1st, year 1 Jamie (who is single) purchase and move into his principal residence. In the early part of year 2,Jamie was laid off from her job. On February 1st, year 2, Jamie sold the home at a 69, 500 gain. She sold the home because she found a new job in a different state. How much of the gain, if any, may Jamie exclude from her gross income in year 2.