Piper owns a vacation cabin in the Tennessee mountains. Without considering the cabin, she has gross income of $65,000. During the year, she rents the cabin for two weeks for $2,500 and uses it herself for four weeks. The total expenses for the year are $10,000 mortgage interest; $1,500 property tax; $2,000 utilities, insurance, and maintenance; and $3,200 depreciation.

1. What effect does the rental of the vacation cabin have on Pipers AGI?

2. What expenses can Piper deduct, and how are they classified (i.e., for or from AGI)?

Adelene, who lives in a winter resort area, rented her personal residence for 14 days while she was visiting Brussels. Rent income was $5,000. Related expenses for the year were as follows: Real property taxes $ 3,800 Mortgage interest 7,500 Utilities 3,700 Insurance 2,500 Repairs 2,100 Depreciation 15,000 Determine the effect on Adelenes AGI