Acc547 W4

Use the following facts to state problems 6062. Alexa owns a condo near Cocoa Beach in Florida. This year, she incurs the following expenses in connection with her condo: Insurance $2,000 Mortgage interest 6,500 crapper taxes 2,000 Repairs & aid 1,400 Utilities 2,500 dispraise 14,500 During the year, Alexa rented out the condo for 100 days. She did non apply the condo at entirely for individualised purposes during the year. Alexas AGI from every last(predicate) sources different than the term of a contract property is $200,000. Unless other than specified, Alexa has no sources of passive income. 61. (LO4) Assuming Alexa receives $20,000 in gross renting receipts, answer the following questions: a. What piece does the letting activity impart on her AGI for the year?

Since Alexa did not use the property for personal student residence and he rented it for more than 100 days, the term of a contract inductions be all deducted for AGI as below: Gross rental receipt: $20,000 less(prenominal): Insurance ($2,000) Mortgage interest ($6,500) Property taxes ($2,000) Repairs & maintenance ($1,400) Utilities ($2,500) Depreciation ($14,500) Net rental receipt: ($8,900) AGI: $200,000- $8,900 = $191,100 b. Assuming that Alexas AGI from other sources is $90,000, what effect does the rental activity have on Alexas AGI? Alexa makes all decisions with evaluate to the property. Since Alexa is making all the decisions with respect to the property, at a lower pl! ace the real estate exception, she is considered an active owner for a rental property. Active participant in the rental activity are allowed to deduct up to $25,000 of rental loss from their personal income. Since Alexas AGI is less than $100,000, she stack deduct the whole amount of $8,900 as an ordinary deduction from her current year income. $90,000 - $8,900 = $81,100 c. Assuming that Alexas AGI from other sources is $120,000, what effect does the rental activity...If you want to get a full essay, evidence it on our website: OrderCustomPaper.com

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