Edward bought a house on Jan 1 of year 1 for $600,000. He made a $100,000 down payment and obtained a $500,000 30- year mortgage loan at 6% interest. In year 1 Patrick paid interest- only on the loan of $30,000. July 1 of year 1 Edward borrowed 75,000 on a home equity loan at 8% interest. In year 1 he made interest only payments of $3,000 on the home equity loan. How much of the $33,000 in interest payments may Edward deduct in year 1 assuming he used the $75,000 to purchase a Chevrolet Corvett?

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If we assume Edward used33000 75000 to purchase a Chevrolet C... View the full answer