AI$/$CT$14-70($LO $14-3)$

Suppose you asked your favorite AI query tool the following question: "Can I deduct interest expense paid on a loan taken related to my house if the borrowed loan balance is only $$40,000"$ The AI tool provided the following response:

As of my last knowledge update in September $2021,$ you can deduct mortgage interest paid on your house, but there are limitations on the amount of mortgage debt that qualifies for the deduction. In the United States, for tax year $2021,$ the deduction is subject to the following limits:

Qualified Residence Interest. You can deduct mortgage interest on qualifying debt up to certain limits$.$ As of tax year $2021,$ for most taxpayers, the limit is interest expense paid on up to $$750,000$ in mortgage debt for those who are married and filing jointly and up to $$375,000$ for those who are single, married and filing separately, or the head of household.

Existing Debt: Debt taken out on mortgages before December $15,2017,$ can be subject to certain other limits$.$ You might be able to deduct interest on mortgage debt up to $$1$ million $($$$500,000$ if married and filing separately$)$ for qualified acquisition indebtedness.

Tax laws can change over time so please consult with a tax professional to make sure you are following all current laws and rules. Also remember that the rules might have changed since September $2021$ so you should also make sure the laws you are following are still current.

Is the AI response correct? Explain?