Which of the following best describes why the home can be a tax shelter? Multiple choice question. Mortgage interest and real estate taxes are tax deductible, which helps lower the cost of home ownership. Only gains in excess of $100,000 are taxable when a home is sold. Capital gains on a home when sold are always tax free. Rent paid by the head of household is tax deductible on Schedule A of the 1040, thereby lowering the cost of a home