Which of the following is considered a non-allowable tax deduction on a mortgage?

The classification of mortgage principal as a non-allowable tax deduction is correct because, for tax purposes, only the interest paid on a mortgage can be deducted from taxable income. Homeowners can benefit from mortgage interest deductions, which can significantly reduce taxable income if they itemize deductions on their federal tax returns. This is a crucial aspect of tax law related to home financing.

In contrast, mortgage principal payments are not deductible because they are simply repayments of the loan amount borrowed, rather than an expense incurred for generating income.

Property taxes are typically deductible, as they are considered an expense related to the ownership of the property. Additionally, homeowner's insurance premiums may also be deductible under certain conditions, particularly if the property generates rental income. However, each of these deductions has specific criteria that must be met to qualify for tax benefits, which distinguishes them from the non-deductible nature of mortgage principal payments.