Choice "D" is correct. Home equity indebtedness is limited to $100,000 on a joint income tax return (or single return), but only $50,000 if married filing separately.
Choices "b" and "a" are incorrect. Home equity indebtedness is all debt, other than acquisition debt, that is secured by a qualified residence to the extent it does not exceed the fair market value of the residence reduced by any acquisition indebtedness.
Choice "c" is incorrect. There is no requirement that home equity indebtedness must exceed the taxpayer's net equity in the residence.
