SELECTED ISSUES INVOLVING THE TAX RELIEF ACT OF 1997
Note: With a home equity loan, only the interest paid on $100,000 of loan principal is tax-deductible. For example: An individual purchases a home for $250,000 with $50,000 down and a $200,000 mortgage (deed of trust). The home’s value increases to $500,000. The taxpayer then borrows $250,000 on the home’s equity and spends the funds. ................
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