Home Office Expenses - Computation of Deduction (LO. 7)

Melanie is employed full-time as an accountant for a national hardware chain. She also has recently started a private consulting practice, which provides tax advice and financial planning to the general public. For this purpose, she maintains an office in her home. Expenses relating to her home for 2014 are as follows:

Real property taxes	$4,000
Interest on home mortgage	4,800
Operating expenses of home	1,000

Melanie's residence cost $376,000 (excluding land) and has living space of 2,000 square feet, of which 30% (600 square feet) is devoted to business. The office was placed in service in February 2013, and under the regular method, Melanie had an unused office in the home deduction of $700 for 2013. Presuming sufficient net income from her consulting practice.

lt;p>Click here to access the depreciation table. Round deprecation to the nearest dollar.

a. What is Melanies office in the home deduction under the regular method. Round your answer to nearest whole value. $

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b. What is Melanies office in the home deduction under the simplified method $