Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home ( 5 0 0 square
Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home square feet where she meets with clients, prepares bills, and performs other workrelated tasks. Her business expenses, other than home office expenses, total $ The following homerelated expenses have been allocated to her home office under the actual expense method for calculating home office expenses.
Real property taxes $
Interest on home mortgage
Operating expenses of home
Depreciation
Also, assume that, not counting the sole proprietorship, Rita's AGI is $ Rita itemizes deductions, and her itemized deduction for nonhome business taxes is less than $ by more than the real property taxes allocated to business use of the home.
Assume Rita's consulting business generated $ in gross income.
Note: Leave no answer blank. Enter zero if applicable.
Required:
What is Rita's home office deduction for the current year?
What would Rita's home office deduction be if her business generated $ of gross income instead of $Answer for both the actual expense method and the simplified method.
Given the original facts, what is Rita's AGI for the year?
Given the original facts, what types and amounts of expenses will she carry over to next year?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started