Question

During 2020, Bobby Brady rented his vacation home for 72 days and stayed in his vacation home for 28 days. Gross rental income from the property was $8,200. Bobby incurred the following expenses: mortgage interest, $4,600; real estate taxes, $2,300; utilities, $950; maintenance, $450; and depreciation, $4,250.

Using the IRS’s approach, compute:

1. Bobby’s net rent income or loss, showing all calculations (his realized amount).

2. The amount(s), if any, that Bobby will report on his Schedule A as an itemized deduction.

3. Any carryover amounts

Answer 1

Answer :-

Total number of days rented during the year=72 days out of 365 days

Mortgage interest=4,600*72/365= 907

Real estate taxes=2,300 *72/365=454

Total number of days the property was used during the year=72+28=100days

Utilities=950*72/100= 684

Maintenenance=450*72/100= 324

Depreciation=4,250*72/100= 3,060

Net Rental Income

Particulars	Amount
Gross rental Income	$8200
Less:Allowable deductions:
Real estate taxes	($454)
Mortage Interest	($907)
Utilities	($684)
Maintanence	($324)
Depreciaition	($3,060)
Net Rental Income	$2,771