A taxpayer sold a residential rental building for a gain of $15,000. The building was purchased and placed in service in March 2010. (The sale of land is not included in this question.) No other property was sold during the current tax year. Before considering the sale, the taxpayer was in the 22% bracket. The depreciation allowed or allowable was $10,635. What is the amount and nature of the gain or loss? $______ gain taxed at a maximum of ___% *

$15,000; 15%.

$15,000; 28%.

$15,000; 25%.

$10,635; 25%.

Rev. Faye Johnson is a full-time minister. The church allows her to use a parsonage that has an annual fair rental value of $25,500. The church pays her an annual salary of $72,000, of which $7,300 is designated for utility costs. Her actual utility costs during the year were $7,100. How much income will Rev. Johnson report for income tax purposes?

$64,700 $64,900 $72,000 $75,500

Explain Please!