Required information Home Ownership: Rent Versus Own Your tax clients, Jack and Diane a married couple filing a joint return, fell in love with a new construction house for sale in their small Illinois hometown. The builder offers two options on the home: purchase with 20% down or rent the home. Assume the following facts and projections when considering the analysis: Jack and Diane both have steady jobs with a current AGI of $120,000. They anticipate annual AGI growth of 3%. The home has a purchase price of $200,000 and is located in an area with an expected annual property value growth rate of 5%. If Jack and Diane purchase the home, they will put 20% down and finance the remainder on a 30 year mortgage at 5.25%. Annual property taxes on the home are 2.6% of the home's value. If Jack and Diane rent the home, they will invest what would have been their 20% down payment into municipal bonds paying an annual interest rate of 4%. The home rents for 1% of the assessed property value per month Jack and Diane will use the home as their principal residence for all 10 years. Regardless of their decision, Jack and Diane intend to contribute 10% of their AGI each year to their favorite qualified charitable organizations. Jack and Diane intend to move out of the area (but in the same State) in 10 years to support their parents in retirement. Their parents live in an area with substantially similar home costs. Jack and Diane live in a state which imposes a tax on Federal AGI at 4.95%. The model uses 2021 income tax brackets and assumes the inflation adjustments to tax brackets and standard deduction continue as trended from 2019 to 2021 Click on the thumbnail images in Connect to open an active Tableau dashboard, which allows you to mouse over the graphs to reveal specific amounts for use in answering the following questions. Note: the Detail pane provides a summation of values based on the selected Year and Option criteria. Use the Year sliders and Option checkboxes to update the visual during your analysis. Income Deductions Detail AGI Muni Bond Int ... Mortgage Int Char Cont Prop Tax State Tax State Tax Cap Std Deduction Itd Deduction Std or Itd Taxable income Tax After Tax CF House Payment Prin CF Property Value 2,751,332 16,000 -77,140 -275,133 -65,455 -136,192 -168,096 -530,668 -520,370 -577,884 2,173,448 299,255 1,682,553 330,753 99,149 2,515,578 Property Value 2,515,578 25.0096 25.0096 Average Tax Rate Effective Tax Rate 20.00% 20.0096 0 2. 4 8 10 6 Year Year 1.10 00 300K 300K After Tax Cash Flow 200K 200K Taxable income 100K 100K Option (All) Own Rent 0 2 4 8 6 Year 10 tableau From a tax perspective, would you advise Jack and Diane to Rent or own the property? Provide detailed reasoning to your advice. Essay Toolbar navigation BLUSE 11 Ini