Question

Adelene, who lives in a winter resort area, rented her personal residence for 14 days while she was visiting Brussels. Rent income was $5,000. Related expenses for the year were as follows: Real property taxes $3,800 Mortgage interest 7,500 Utilities 3,700 Insurance 2,500 Repairs 2,100 Depreciation 15,000 If an answer is zero, enter "0". a. Determine how much of the rental income is reportable. $ b. Determine whether the expenses are deductible. Select "Yes" if deductible otherwise select "No". Depreciation Real property taxes Repairs Utilities Mortgage interest Insurance

Answer 1

11,300 dollars are reportable.

Depreciation: No

Real property taxes: Yes

Utilities: No

Repairs: No

Mortgage interest: Yes

Insurance: No

Step by Step Explanation:

Adelene rented her residence for 14 days, but since she rented it for less than a month, she can not include the $5,000 dollars she got on her gross income.

Therefore, the only rental income that can be reported are the real property taxes and the mortgage interest (3,800 + 7,500)

b) Determine whether the expenses are deductible.

Depreciation: No (because the residence was only rented for 14 days)

Real property taxes: Yes

Utilities: No (because the residence was only rented for 14 days)

Repairs: No (because the residence was only rented for 14 days)

Mortgage interest: Yes

Insurance: No (because the residence was only rented for 14 days)