Multiple Choice
Matthew purchases a new principal residence in the current year and pays points of $2,000 to obtain a mortgage loan. What is the proper tax treatment for the points paid?
A) The points are a nondeductible personal expense.
B) The points must be amortized over the life of the loan.
C) The points are fully deductible in the current year.
D) The points must be capitalized into the cost of the residence.
E) The points must be amortized over 5 years.
Correct Answer:
Verified
Correct Answer:
Verified
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