Question

Calculator Exercise 12-12 (Algorithmic) (L0. 3) Emily spent $218,000 to rehabilitate a certified historic building (adjusted basis of $141,700) that originally had been placed in service in 1935. Compute Emily's credit for rehabilitation expenditures.

Answer 1

Because the building is before 1936, and was substantially rehabilitated, she can take full 10% credit on Amount spent.

Emily spent $218,000

Emily's credit for Rehabilitation expenditure = $218,000 * 10% = $21,800

So, correct answer is $21,800