Robyn rents her beach house for 60 days and uses it for personal use for 30 days during the year.The rental income is $6,000 and the expenses are as follows: Using the IRS approach,total expenses that Robyn can deduct on her tax return associated with the beach house are:

Question

Robyn rents her beach house for 60 days and uses it for personal use for 30 days during the year.The rental income is $6,000 and the expenses are as follows:  Using the IRS approach,total expenses that Robyn can deduct on her tax return associated with the beach house are:

Quizplus · Accepted Answer

According to the IRS approach, Robyn can deduct expenses up to the amount of rental income earned, which is $6,000 in this case. Additionally, she can also deduct expenses related to the personal use portion of the property, which is calculated as follows:

Total expenses = (Expenses for rental use / Total days rented) x Personal use days
Total expenses = ($8,000 / 60) x 30
Total expenses = $4,000

Therefore, the total expenses that Robyn can deduct on her tax return associated with the beach house is $10,000 ($6,000 rental expenses + $4,000 personal use expenses). However, since the total expenses exceed the rental income, she can only deduct up to the rental income amount, which is $6,000. Thus, the best choice is option D.

Robyn Rents Her Beach House for 60 Days and Uses