Alexa owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: Insurance Mortgage interest Property taxes Repairs & maintenance $ 2,000 6,500 2,000 1,400 Utilities Depreciation 2,500 14,500 During the year, Alexa rented out the condo for 100 days. Alexa's 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 100 days, Alexa uses the condo for 8 days of personal use. Also assume that Alexa receives $30,000 of gross rental receipts, her itemized deductions exceed the standard deduction before considering expenses associated with the condo, and her itemized deduction for non-home 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: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. a. What is the total amount of for 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. For AGI deductions 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. From AGI deductions
Alexa owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: Insurance Mortgage interest Property taxes Repairs & maintenance $ 2,000 6,500 2,000 1,400 Utilities Depreciation 2,500 14,500 During the year, Alexa rented out the condo for 100 days. Alexa's 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 100 days, Alexa uses the condo for 8 days of personal use. Also assume that Alexa receives $30,000 of gross rental receipts, her itemized deductions exceed the standard deduction before considering expenses associated with the condo, and her itemized deduction for non-home 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: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. a. What is the total amount of for 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. For AGI deductions 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. From AGI deductions
Chapter3: Tax Formula And Tax Determination; An Overview Of property Transactions
Section: Chapter Questions
Problem 29P
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Transcribed Image Text:Alexa owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in
connection with her condo:
Insurance
Mortgage interest
Property taxes
Repairs & maintenance
$ 2,000
6,500
2,000
1,400
Utilities
Depreciation
2,500
14,500
During the year, Alexa rented out the condo for 100 days. Alexa's 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 100 days, Alexa uses the condo for 8 days of personal
use. Also assume that Alexa receives $30,000 of gross rental receipts, her itemized deductions exceed
the standard deduction before considering expenses associated with the condo, and her itemized
deduction for non-home 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: Do not round intermediate calculations. Round your final answers to the nearest whole dollar
amount.
a. What is the total amount of for 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.
For AGI deductions
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.
From AGI deductions
c. Would Alexa be better or worse off after taxes in the current year if she uses the Tax Court method of allocating
expenses?
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