Dighi, an artist, uses a room in his home (250 square feet) as a studio exclusively to paint. The studio meets the requirements for a home office deduction. (Painting is considered his trade or business.) The following information appears in Dighi's records:

Revenue from sale of paintings $4,000

Expenses attributable to business of painting such as supplies 1,800

Expenses related to home office:

Property taxes on portion of home where he paints 900

Utilities, insurance, etc 700

Depreciation of portion of home 800

(a) What is the amount of Dighi's home office deduction if he is self-employed? (Show calculations)

(b) If some amount is not allowed under the tax law, how is the disallowed amount treated? (Show calculations)

(c) Assume all of Dighi's records of expenses relating to the room were destroyed in a major paint spill. How much of a home office deduction, if any, will he be allowed? (Show calculations)