Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home (500 square feet) where she meets with clients, prepares bills, and performs other work-related tasks. Her business expenses, other than home office expenses, total $5,600. The following home-related expenses have been allocated to her home office under the actual expense method for calculating home office expenses. Real property taxes $ 1,600 Interest on home mortgage 5,100 Operating expenses of home 800 Depreciation 1,600 Also, assume that, not counting the sole proprietorship, Rita's AGI is $60,000. Rita itemizes deductions, and her itemized deduction for non-home business taxes is less than $10,000 by more than the real property taxes allocated to business use of the home. Assume Rita’s consulting business generated $13,000 in gross income for the current year. Further, assume Rita uses the actual expense method for computing her home office expense deduction. Problem 14-65 Part c (Static) c. Assuming the original facts, what types and amounts of expenses will she carry over to next year? (Leave no answer blank. Enter zero if applicable.) Tier 1 expenses carries over to next year = Tier 2 expenses carries over to next year = Tier 3 expenses carries over to next year =
Rita owns a sole proprietorship in which she works as a management consultant. She maintains an office in her home (500 square feet) where she meets with clients, prepares bills, and performs other work-related tasks. Her business expenses, other than home office expenses, total $5,600. The following home-related expenses have been allocated to her home office under the actual expense method for calculating home office expenses.
| Real property taxes | $ 1,600 |
|---|---|
| Interest on home mortgage | 5,100 |
| Operating expenses of home | 800 |
| Depreciation | 1,600 |
Also, assume that, not counting the sole proprietorship, Rita's AGI is $60,000. Rita itemizes deductions, and her itemized deduction for non-home business taxes is less than $10,000 by more than the real property taxes allocated to business use of the home.
Assume Rita’s consulting business generated $13,000 in gross income for the current year. Further, assume Rita uses the actual expense method for computing her home office expense deduction.
Problem 14-65 Part c (Static)
c. Assuming the original facts, what types and amounts of expenses will she carry over to next year? (Leave no answer blank. Enter zero if applicable.)
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
