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Reportable income is AGI 60,000

Deductible expenses 19250

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Problem 6-45 (LO. 3) Alex, who is single, conducts an activity in 2019 that is appropriately classified as a hobby. The activity produces the following revenues and expenses: Revenue Property taxes Materials and supplies $18,000 3,000 4,500 2,000 5,000 750 Utilities Advertising Insurance Depreciation 4,000 Without regard to this activity, Alex's AGI is $42,000. Determine the amount of income Alex must report and the amount of the expenses he is permitted to deduct. Assume Alex itemizes his deductions. Reportable income: $ Deductible expenses: $ X x Feedback Check My Work Business or investment expenses are deductible only if the taxpayer can show that the activity was entered into for the purpose of making a profit. Certain activities may have either profit-seeking or personal attributes, depending upon individual circumstances