Indicate three provisions of the Federal Tax Law intended to promote home ownership.

Expert Solution

Three provisiosn of the Federal tax law intended to promote home ownership:

1. Home mortgage interest: For loans taken after Dec 16,2017 ,tax laws allow taxpayers to deduct interest on upto $750,000 of mortgage debt if you are married and filing jointly ( $375,000 of mortgage debt if you are married filing separately). For mortgages taken from Oct. 14, 1987, through Dec15, 2017 taxpayers to deduct interest on upto $1 million of mortgage debt if you are married and filing jointly ( $500,000 of mortgage debt if you are married filing separately)

2. Property taxes : A taxpayer can deduct upto $10,000 ( $5000 if married and filing seperately) of property taxes [state and local income, sales and property taxes combined].

3. Discount points: Points used to reduce the interest rate on a home mortgage are deductible. Points are treated as prepaid interest and can be deducted as home mortgage interest. The points that can be deducted are to be within the limits of the overall home mortgage interest deduction provisions.

ekkarill92 answered 2 years ago

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