A taxpayer purchased a home for $1,000,000 in Year 1 (post-2017), taking out a $900,000 mortgage secured by the home. In Year 2, the taxpayer took out a $50,000 Home Equity Line of Credit (HELOC) to pay for a vacation. The interest paid in Year 2 was $36,000 on the mortgage and $2,500 on the HELOC. What is the deductible qualified residence interest for Year 2?

1. Identify Debt Limits (TCJA): For acquisition debt after Dec 15, 2017, limit is $750,000.<br/>2. HELOC Rule: Interest only deductible if used to buy, build, or substantially improve the home. Here, used for vacation -> Not deductible.<br/>3. Calculate Deductible Mortgage Interest: Total Debt $900,000. Limit $750,000.<br/>4. Ratio: $750,000 / $900,000 = 0.8333.<br/>5. Deductible Interest: $36,000 * 0.8333 = $30,000.