Interest Paid or Accrued During 2019 on Aggregate Acquisition Indebtedness

question 97

True/False

Interest paid or accrued during 2019 on aggregate acquisition indebtedness of $2 million or less ($1 million or less for married persons filing separate returns) is deductible as qualified residence interest.

---

Definitions:

Externalities

Costs or benefits arising from an economic activity that affect bystanders and are not reflected in market prices.

Distortionary Taxes

Taxes that cause changes in behavior and decision-making, leading to inefficiencies in the market.

Nonneutral Taxes

Taxes that disproportionately affect one group or type of economic activity over another, often used to influence market outcomes.

Second Best

A situation or solution that is accepted in the absence of a preferred option.