Tamar owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: Insurance Advertising expense Property taxes Mortgage interest Repairs & maintenance $ 1,350 735 5,050 1,110 1,120 Utilities Depreciation 1,440 12,200 During the year, Tamar rented out the condo for 85 days, receiving $22,750 of gross income. She personally used the condo for 39 days during her vacation. Tamar's itemized deduction for nonrental taxes is less than $10,000 by more than the property taxes allocated to the rental use of the property. Assume Tamar uses the Tax Court method of allocating expenses to rental use of the property. Assume 365 days in the current year. Note: Do not round apportionment ratio. Round all other dollar values to the nearest whole dollar amount. Required: a. What is the total amount of for AGI (rental) deductions Tamar may deduct in the current year related to the condo (assuming she itemizes deductions before considering deductions associated with the condo)? b. What is the total amount of itemized deductions Tamar may deduct in the current year related to the condo? c. If Tamar's basis in the condo at the beginning of the year was $178,000, what is her basis in the condo at the end of the year? d. Assume that gross rental revenue was $4,550 (rather than $22,750). What amount of for AGI deductions may Tamar deduct in the current year related to the condo? Answer is complete but not entirely correct. a. For AGI (rental) deductions 18,445 b. Itemized deductions $ 10,382 ( c. Basis in the condo at the end of the year $ 170,003 d. For AGI deductions 0x
Tamar owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: Insurance Advertising expense Property taxes Mortgage interest Repairs & maintenance $ 1,350 735 5,050 1,110 1,120 Utilities Depreciation 1,440 12,200 During the year, Tamar rented out the condo for 85 days, receiving $22,750 of gross income. She personally used the condo for 39 days during her vacation. Tamar's itemized deduction for nonrental taxes is less than $10,000 by more than the property taxes allocated to the rental use of the property. Assume Tamar uses the Tax Court method of allocating expenses to rental use of the property. Assume 365 days in the current year. Note: Do not round apportionment ratio. Round all other dollar values to the nearest whole dollar amount. Required: a. What is the total amount of for AGI (rental) deductions Tamar may deduct in the current year related to the condo (assuming she itemizes deductions before considering deductions associated with the condo)? b. What is the total amount of itemized deductions Tamar may deduct in the current year related to the condo? c. If Tamar's basis in the condo at the beginning of the year was $178,000, what is her basis in the condo at the end of the year? d. Assume that gross rental revenue was $4,550 (rather than $22,750). What amount of for AGI deductions may Tamar deduct in the current year related to the condo? Answer is complete but not entirely correct. a. For AGI (rental) deductions 18,445 b. Itemized deductions $ 10,382 ( c. Basis in the condo at the end of the year $ 170,003 d. For AGI deductions 0x
Chapter10: Deduct Ions And Losses: Certain Itemized Deduct Ions
Section: Chapter Questions
Problem 31P
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Transcribed Image Text:Tamar owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo:
Insurance
Advertising expense
Property taxes
Mortgage interest
Repairs & maintenance
$ 1,350
735
5,050
1,110
1,120
Utilities
Depreciation
1,440
12,200
During the year, Tamar rented out the condo for 85 days, receiving $22,750 of gross income. She personally used the condo for 39
days during her vacation. Tamar's itemized deduction for nonrental taxes is less than $10,000 by more than the property taxes
allocated to the rental use of the property.
Assume Tamar uses the Tax Court method of allocating expenses to rental use of the property. Assume 365 days in the current year.
Note: Do not round apportionment ratio. Round all other dollar values to the nearest whole dollar amount.
Required:
a. What is the total amount of for AGI (rental) deductions Tamar may deduct in the current year related to the condo (assuming she
itemizes deductions before considering deductions associated with the condo)?
b. What is the total amount of itemized deductions Tamar may deduct in the current year related to the condo?
c. If Tamar's basis in the condo at the beginning of the year was $178,000, what is her basis in the condo at the end of the year?
d. Assume that gross rental revenue was $4,550 (rather than $22,750). What amount of for AGI deductions may Tamar deduct in the
current year related to the condo?
Answer is complete but not entirely correct.
a. For AGI (rental) deductions
18,445
b. Itemized deductions
$
10,382 (
c. Basis in the condo at the end of the year
$
170,003
d. For AGI deductions
0x
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