Question

where in the book do you find calcualtions for Dennis is a self-employed hair stylist who operates a salon in his home. The property taxes and interest allocated to the business amount to $5,000, maintenance and utilities allocated to the business total $2,100, and depreciation allocated to the business use of the home equals $3,100 for the 2020 tax year. a. If Dennis' gross revenue after deducting supplies for his business is $5,900 for the current tax year, calculate his allowable deductions for the home office. b. If Dennis' gross revenue after deducting supplies for his business is $13,800, calculate his allowable deductions for the home office.

Answer 1

Step-by-step explanation:

a. . If Dennis' gross revenue after deducting supplies for his business is $5,900 for the current tax year, calculate his allowable deductions for the home office.

The allowable deductions for the home office will be $5900. It should be noted that of the $5900, $5,000 will be for taxes and interest while the remaining $900 will be for maintenance and utilities.

b. Dennis' gross revenue after deducting supplies for his business is $13,800, calculate his allowable deductions for the home office.

Allowable deductions will be:

= $5,000 + $2,100 + $3,100

= $10,200