Dillon rented his personal residence at Lake Tahoe for 14 days while he was vacationing in Ireland. He resided in the home for the remainder of the year. Rental income from the property was $6,500. Expenses associated with use of the home for the entire year were as follows:

Real property taxes ............................$3,100

Mortgage interest ..............................12,000

Repairs .......................................... 1,500

Insurance ....................................... 1,500

Utilities ......................................... 3,900

Depreciation .................................... 13,000

a. What effect does the rental have on Dillon's AGI?

b. What effect does the rental have on Dillon's itemized deductions?