Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

[The following information applies to the questions displayed below.] Alexa owns a condominium near Cocoa Beach in Florida. In 2021, she incurs the following expenses

[The following information applies to the questions displayed below.]

Alexa owns a condominium near Cocoa Beach in Florida. In 2021, she incurs the following expenses in connection with her condo:

Insurance $ 3,800
Mortgage interest 11,200
Property taxes 3,800
Repairs & maintenance 950
Utilities 3,700
Depreciation 19,100

During the year, Alexa rented out the condo for 170 days. She did not use the condo at all for personal purposes during the year. Alexas AGI from all sources other than the rental property is $200,000. Unless otherwise specified, Alexa has no sources of passive income. Assume that in addition to renting the condo for 170 days, Alexa uses the condo for 8 days of personal use. Also assume that Alexa receives $43,000 of gross rental receipts and her itemized deductions exceed the standard deduction before considering expenses associated with the condo and that her itemized deduction for nonhome business taxes is less than $10,000 by more than the real property taxes allocated to rental use of the home. Answer the following questions:

Note that the home is considered to be a nonresidence with rental use.

b. What is the total amount of from AGI deductions relating to the condo that Alexa may deduct in the current year? Assume she uses the IRS method of allocating expenses between rental and personal days. (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions