Pat owned and occupied a residence near Hofstra University (adjusted basis of $220,000) for four years. On June 30 2020, the house was sold for $300,000 (selling expenses were $10,000). Property taxes for the year were paid by Pat prior to selling the property in the amount of $14,000. Pat’s tuition at Hofstra cost $30,000. He also paid tax preparation fees of $500. He also lost $200 on the sale of a beer keg he purchased in his junior year. He incurred commuting expenses to his work study in the amount of $300 including gas and oil changes.

Pat’s return reported the following:

Income: $10,000 Wages (Hofstra Work Study)

Rental Income $5,000 7 day rental for graduation week

Gross income: $15,000

Less itemized deductions $14,000

Taxable income $1,000 (assume this figure is also the tax due)

Credits: American Opportunity $2,500

(Please ignore EITC(earned income tax credit) for this problem)

Refund claimed: $1,500

In a 30 day letter the IRS adds income as follows:

Long-term Capital gain $100,000

Disallowed itemized deductions of $14,000 for Nassau County property taxes claimed

Question:

What is the gross income and taxable income?