TP owns a residential condominium unit that he rents to tenants. TP purchased the condo several years ago, paying $50,000 of his own savings, and $150,000 borrowed from a local bank. Interest only is payable on the recourse loan at 7% per year.

Over the course of the year, TP received rent payments from tenants of $20,000, but he also incurred a number of expenses. He had interest payments of $10,500, condo fees of $2,000, real estate taxes of $1,500, insurance premiums of $1,000, and miscellaneous repair and service costs of $500. Consequently, TP's out of pocket expenses totaled $15,500, leaving him with a positive cash flow from the property of $4,500 ($20,000 rental payments - $15,500 expenses).

In addition, because TP was entitled to depreciation deductions with respect to the condo of $7,300, he had total deductions for tax purposes of $22,800.

What are TP's total expenses deductible for the taxable year as determined under the at-risk rules?

Select one:

A. $0

B. $2,800

C. $20,000

D. $22,800