Sally's annual mortgage payment includes $4,467 in interest payments. How much can she deduct on her income tax return for 2023?

In the context of mortgage interest deductions for individual taxpayers in the United States, individuals are allowed to deduct the amount paid in mortgage interest from their taxable income. Since Sally's annual mortgage payment includes $4,467 in interest payments, she can fully deduct this amount on her income tax return for the year 2023. The mortgage interest deduction applies to interest paid on qualified residence loans, which typically includes mortgages on primary residences and, in some cases, second homes.

This deduction can significantly reduce her taxable income, leading to potential tax savings. It's important for taxpayers to maintain accurate records of their mortgage interest payments, usually documented through Form 1098 provided by the lender. In Sally's case, since her entire payment of $4,467 is attributable to interest, she is eligible to deduct this full amount.