Trevor traveled a lot this year, living in his home for only 3 months. His home was
Question:
Trevor traveled a lot this year, living in his home for only 3 months. His home was left unoccupied for 6 months and rented it out for 3 months. He has the following activity related to his home for the entire year:
Rental Income
6,200
Acquisition Mortgage Interest
12,000
Property Taxes
4,000
Utilities
400
Depreciation
2,000
Other activity for the year included:
Salary
50,000
Loss on sale of stock to his father
3,000
Cash charitable contributions
16,000
Tax return preparation fees*
2,000
*50% of tax return prep fees relate to preparer's time spent on Trevor's rental activity
For the purposes of this problem, please assume that there are 30 days in each month and you may assume that there are 360 days in the year. Calculate Trevor's 2020 taxable income, trying to minimize his current year taxable income as much as the tax law allows. Be sure to disclose any carryovers to next year. Note that Trevor is a single taxpayer.
Fundamentals of Taxation 2015
ISBN: 9781259293092
8th edition
Authors: Ana Cruz, Michael Deschamps, Frederick Niswander, Debra Prendergast, Dan Schisler, Jinhee Trone