Question

When a taxpayer owns a part rental/part personal-use property, how is mortgage interest on that property treated on the tax return?

Prorated deduction on Schedule E and Schedule C.

Prorated deduction on Schedule E and Schedule A.

The taxpayer can choose to deduct the full amount on either Schedule E or Schedule A.

Fully deducted on Schedule E.

Answer 1

Given that :-

When a tax payer owns a part rental / part personal use property, how is mortgage interest on that property treated on the tax return?

Sol :- Answer is B prorated deduction on schedule E and sechedule A.

Explanation :- When a tax payer uses his real astate (i) more than 14 days or (ii) 10% of rental days, its classified as personal property at the same time uses it forrental, then its called a mixed use property and deduction for property taxes is allowed prorated on schedule E (rental) and schedule A (personal).