Nathan owns a tri-plex in Santa Maria,California.He lives in one and rents the other two remaining units.All three units are identical.He incurred the following expenses for the entire building: $\begin{array}{lr}
\text { Mortgage interest } & \$ 20,000 \
\text { Maintenance } & 6,200 \
\text { Property taxes } & 9,000 \
\text { Utilities } & 5,000 \
\text { Depreciation } & 4,000
\end{array}$ How much in rental expenses can Nathan deduct against the rental income on a Schedule E in the current year (without considering any passive loss limitations)? (Round your answers to the nearest whole dollar)

Question

Quizplus · Accepted Answer

Nathan can deduct expenses related to the rental portions of his property. Since he lives in one unit and rents out the other two, two-thirds of the expenses are deductible against rental income. The calculation is as follows: $(\$20,000 + \$6,200 + \$9,000 + \$5,000 + \$4,000) \times \frac{2}{3} = \$29,467$.

Nathan Owns a Tri-Plex in Santa Maria,California How Much in Rental Expenses Can Nathan Deduct Against the and Rents