Question

During 2019, Kerri incurs the folowing expenses with respect to her beachfront condominium in Hawai (Click the icon to view the data.) During 2019, Kerri used the condominium 25 days for vacation. She rented it out for a total of 100 days, generating a total gross income of $9,600. Read the requirements Requirement a. What are the total amounts of deductions for and from AGI that Kerri may take during 2019 with respect to the condominium using the IRS allocation method? (For purposes of this problem, use the allocation formula set forth by Sec. 280A. Enter "O for zero amounts.) For AG From AGI Item More Info Insurance Repairs and maintenance Interest on mortgage Amount Expense Item Property taxes 580 Insurance Utilities 620 Repairs and maintenance Depreciation 2.200 Incorrect Interest on mortgage 2.600 Total deductions Property taxes 0/1) 600 Utilities (1/1) 7,400 Depreciation Done Enter any number in the edit fields and then click Check Answer. Check Answer Clear All part remaining.

Answer 1

Answer -

Item	For AGI	From AGI
Insurance	$464
Repairs and maintenance	$496
Interest on mortgage	$1760	$440
Property taxes	$2080	$520
Utilities	$480	$120
Depreciation	$4320
Total deductions	$9600	$1080

Calculation :

1. Insurance :

For AGI = [(100 / 125) * $580] = $464

2. Repairs and maintenance :

For AGI = [(100 / 125) * $620] = $496

3. Interest on mortgage :

For AGI = [(100 / 125) * $2200] = $1760

From AGI = $2200 - $1760 = $440

4. Property taxes :

For AGI = [(100 / 125) * $2600] = $2080

From AGI = $2600 - $2080 = $520

5. Utilities :

For AGI = [(100 / 125) * $600] = $480

From AGI = $600 - $480 = $120

6. Depreciation :

For AGI = [(100 / 125) * $7400] = $5920

However, it is limited to the remaining amount of income, $4320, after the deductions for Insurance, Repairs and maintenance, Interest on mortgage, Property taxes, and Utilities.

Note: the nondeductible portion of $1600 may be carried over to next year