Which of the Following Statements Is True Regarding the Deductibility

question 35

Multiple Choice

Which of the following statements is true regarding the deductibility of investment interest expense?

• A)Deductible in full subject to the 2% of AGI floor that applies to miscellaneous itemized deductions.
• B)Deductible only to the extent of net investment income, excess amounts cannot be carried forward and thus are non-deductible.
• C)Deductible only to the extent of the interest on a principal amount that does not exceed $1,000,000.
• D)Deductible only to the extent of net investment income; any excess amounts can be carried forward indefinitely.

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