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Question - In 2017 (old law), Cathy bought a house (her principal residence) for $2,000,000, paying $500,000 down and borrowing the other $1,500,000 at 5% interest. If her interest expense in 2018 (new law) is $75,000, how much will her maximum deduction for interest expenses be?
1) $75,000 (old law rules "grandfathered" in)
2) $50,000 (old law rules "grandfathered" in)
3) $55,000 (old law rules "grandfathered" in)
4) $0 (old law rules not "grandfathered" in)
5) None of these
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