Nikki is a single taxpayer who owns a vacation cottage on the lake. During the year, she rented it for $2,000 for 14 days, lived in it for 56 days, and left it vacant the remainder of the year. The year's expenses amounted to $5,000 interest expense, $800 property taxes, $1,500 utilities and maintenance, and $2,400 depreciation. Using the IRS method of allocating expenses, how much of the property- related expenses will be deductible for AGI?

Question

Quizplus · Accepted Answer

Since Nikki rented the property for less than 15 days, the rental income is not taxable, and the related expenses are not deductible for AGI.

Nikki Is a Single Taxpayer Who Owns a Vacation Cottage