1. Kiddi rented the apartment in the basement of his personal residence to an unrelated married couple for the entire 2018 (Year 1). The apartment consists of 1,000 square feet, which represents 25% of the total space in the residence. Kiddie's total expenses in 2018 (the year of purchase - Year 1) are as follows:

Interest $2,500

Taxes $900

Utilities (all paid by W) $1,200

Repairs (to apartment plumbing) $150

Insurance (covers period January 1, 2018 (Year 1),

through December 31, 2020 (Year 3) $600

Fair market value of Mr. Robert's time applied to maintenance $200

Depreciation of 1,000 sq. ft. of residence $1,000

What is the amount of rental expenses that may be deducted on Mr. Robert's Schedule E (assuming no passive loss limitations)?

$1,600

$1,700

$1,800

$2,350

Answer rating: 100% (QA)

Computation of expenses to be considered as rental expense Amountin Particulars Interest 250025 Note ... View the full answer