Tamar owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: $ 650 950 5,200 1,190 1,030 Insurance Advertising expense Mortgage interest. Property taxes Repairs & maintenance Utilities Depreciation 1,000 10,700 During the year, Tamar rented out the condo for 97 days, receiving $34,500 of gross income. She personally used the condo for 57 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 $187,000, what is her basis in the condo at the end of the year? d. Assume that gross rental revenue was $4,000 (rather than $34,500). What amount of for AGI deductions may Tamar deduct in the current year related to the condo? a. For AGI (rental) deductions b. Hemized deductions c. Basis in the condo at the end of the year d. For AGI deductions
Tamar owns a condominium near Cocoa Beach in Florida. In 2023, she incurs the following expenses in connection with her condo: $ 650 950 5,200 1,190 1,030 Insurance Advertising expense Mortgage interest. Property taxes Repairs & maintenance Utilities Depreciation 1,000 10,700 During the year, Tamar rented out the condo for 97 days, receiving $34,500 of gross income. She personally used the condo for 57 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 $187,000, what is her basis in the condo at the end of the year? d. Assume that gross rental revenue was $4,000 (rather than $34,500). What amount of for AGI deductions may Tamar deduct in the current year related to the condo? a. For AGI (rental) deductions b. Hemized deductions c. Basis in the condo at the end of the year d. For AGI deductions
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 55P
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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
Mortgage interest
Property taxes
Repairs & maintenance
Utilities
Depreciation
$ 650
950
5,200
1,190
1,030
1,000
10,700
During the year, Tamar rented out the condo for 97 days, receiving $34,500 of gross income. She personally used the condo for 57
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 $187,000, what is her basis in the condo at the end of the year?
d. Assume that gross rental revenue was $4,000 (rather than $34,500). What amount of for AGI deductions may Tamar deduct in the
current year related to the condo?
a. For AGI (rental) deductions
b. Itemized deductions
c. Basis in the condo at the end of the year
d. For AGI deductions
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