Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Alexa owns a condominium near Cocoa Beach in Florida. In 2021, she incurs the following expenses in connection with her condo: Insurance $ 2,600 Mortgage

Alexa owns a condominium near Cocoa Beach in Florida. In 2021, she incurs the following expenses in connection with her condo:

Insurance $ 2,600
Mortgage interest 7,400
Property taxes 2,480
Repairs & maintenance 1,700
Utilities 3,700
Depreciation 16,000

During the year, Alexa rented out the condo for 100 days. She did not use the condo at all for personal purposes during the year. Alexas AGI from all sources other than the rental property is $200,000. Unless otherwise specified, Alexa has no sources of passive income.

Assuming Alexa receives $22,400 in gross rental receipts, answer the following questions: (Leave no answer blank. Enter zero if applicable.)

A. What effect does the rental activity have on her AGI for the year?

b. Assuming that Alexas AGI from other sources is $90,000, what effect does the rental activity have on Alexas AGI? Alexa makes all decisions with respect to the property.

C. Assuming that Alexas AGI from other sources is $120,000, what effect does the rental activity have on Alexas AGI? Alexa makes all decisions with respect to the property.

d. Assume that Alexas AGI from other sources is $200,000. This consists of $141,000 salary, $12,400 of dividends, $28,600 of long-term capital gain, and net rental income from another rental property in the amount of $18,000. What effect does the Cocoa Beach condo rental activity have on Alexas AGI?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance For Non-Finance Executives

Authors: Anurag Singal

1st Edition

1952538327, 9781952538322

More Books

Students also viewed these Accounting questions