Noreen is a self-employed consultant who uses 10% of her residence as an office. The office is used exclusively for business and is frequented by customers on a regular basis. Noreen also uses her den as an office (7% of the total floor space of her home) to prepare bills and keep records. However, the den is also used by her children as a TV room. In 2021, Noreen's net income from the consulting business (other than her home office expenses) amounts to $100,000 in 2021. She also incurs $900 of expenses directly related to the office (e.g., painting of the office, window blinds). Noreen incurs the following expenses in 2021 related to her residence: (Click the icon to view the expenses.) Read the requirements. Requirement a. Which of the expenditures above (if any) are deductible for 2021? Are they for AGI or from AGI deductions? Complete the table below to show the amount and classification of each of expense in. (Noreen is electing to use the "actual expenses" rather than the "safe harbor" method. Complete all input fields. Enter a "0" if an amount is not deductible.) Direct home office expenses Indirect home office expenses: Real estate taxes Mortgage interest Insurance Depreciation. $ $ Repairs and utilities Total indirect home office expenses Total expense for office in home 900 3,400 9,000 700 8,500 2,500 ... Amount of Deduction Type of Deduction Data table Real estate taxes Mortgage interest Insurance Depreciation Repairs and utilities Total $ $ 3,400 9,000 700 8,500 2,500 24,100 X Requirements a. Which of the expenditures above (if any) are deductible for 2021? Are they for AGI or from AGI deductions? b. Would your answer to Part a change if Noreen's net income from consulting were only $3,040 for the year? Print Done X etho
Noreen is a self-employed consultant who uses 10% of her residence as an office. The office is used exclusively for business and is frequented by customers on a regular basis. Noreen also uses her den as an office (7% of the total floor space of her home) to prepare bills and keep records. However, the den is also used by her children as a TV room. In 2021, Noreen's net income from the consulting business (other than her home office expenses) amounts to $100,000 in 2021. She also incurs $900 of expenses directly related to the office (e.g., painting of the office, window blinds). Noreen incurs the following expenses in 2021 related to her residence: (Click the icon to view the expenses.) Read the requirements. Requirement a. Which of the expenditures above (if any) are deductible for 2021? Are they for AGI or from AGI deductions? Complete the table below to show the amount and classification of each of expense in. (Noreen is electing to use the "actual expenses" rather than the "safe harbor" method. Complete all input fields. Enter a "0" if an amount is not deductible.) Direct home office expenses Indirect home office expenses: Real estate taxes Mortgage interest Insurance Depreciation. $ $ Repairs and utilities Total indirect home office expenses Total expense for office in home 900 3,400 9,000 700 8,500 2,500 ... Amount of Deduction Type of Deduction Data table Real estate taxes Mortgage interest Insurance Depreciation Repairs and utilities Total $ $ 3,400 9,000 700 8,500 2,500 24,100 X Requirements a. Which of the expenditures above (if any) are deductible for 2021? Are they for AGI or from AGI deductions? b. Would your answer to Part a change if Noreen's net income from consulting were only $3,040 for the year? Print Done X etho
Chapter6: Business Expenses
Section: Chapter Questions
Problem 33P
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Transcribed Image Text:Noreen is a self-employed consultant who uses 10% of her residence as an office. The office is used exclusively for business and is frequented by customers on a regular basis. Noreen
also uses her den as an office (7% of the total floor space of her home) to prepare bills and keep records. However, the den is also used by her children as a TV room. In 2021, Noreen's
net income from the consulting business (other than her home office expenses) amounts to $100,000 in 2021. She also incurs $900 of expenses directly related to the office (e.g., painting
of the office, window blinds). Noreen incurs the following expenses in 2021 related to her residence:
(Click the icon to view the expenses.)
Read the requirements.
Requirement a. Which of the expenditures above (if any) are deductible for 2021? Are they for AGI or from AGI deductions?
Complete the table below to show the amount and classification of each of expense in. (Noreen is electing to use the "actual expenses" rather than the "safe harbor" method. Complete all
input fields. Enter a "0" if an amount is not deductible.)
Direct home office expenses
Indirect home office expenses:
Real estate taxes
Mortgage interest
Insurance
Depreciation.
$
$
Repairs and utilities
Total indirect home office expenses
Total expense for office in home
900
3,400
9,000
700
8,500
2,500
...
Amount of
Deduction
Type of
Deduction
Transcribed Image Text:Data table
Real estate taxes
Mortgage interest
Insurance
Depreciation
Repairs and utilities
Total
$
$
3,400
9,000
700
8,500
2,500
24,100
X
Requirements
a. Which of the expenditures above (if any) are deductible for 2021? Are they
for AGI or from AGI deductions?
b. Would your answer to Part a change if Noreen's net income from consulting
were only $3,040 for the year?
Print
Done
X
etho
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