Question

O stop taking any depreciation on the machine. Change from the general MACRS to a straight-line system. Recapture a prorated portion of that which was expensed. O Change nothing. □Mark for follow up Question 34 of 75 Marcela is a sole proprietor and wishes to use the actual method for business-use-of-home expenses. Her mortgage interest for 2017 is $4,392, and real estate taxes are $1,278. Her home office is 400 square feet, and her total home square footage is 2,000 square feet. What is the home office expense deduction without any other qualified expense, including depreciation? O $5,670 o $2,000 o $1,500 O $1.134 □ Mark for follow up

Answer 1

Answer :(d)

Explanation :

Mortgage interest = $4392

Real estate tax = $ 1278

Total deductions = $ 5670

Since only 400 sq. ft. of total 2000 sq. feet is used for business purposes and it is 20% of total area, therefore only 20 % of total deductions can be used for home office expense deductions.

Total home office expense deduction = 0.20 * 5670

= $ 1134

IN CASE OF ANY DOUBTS FEEL FREE TO COMMENT BELOW. PLEASE RATE MY ANSWER BY HITTING ??

THANK YOU