In January 2017, Iris Corporation purchased and placed in service a certified historic structure building that houses retail businesses. The cost was $300,000, of which $25,000 applied to the land. In modernizing the facility, Iris Corporation incurred $312,000 of renovation costs of the type that qualify for the rehabilitation credit. These improvements were placed in service in October 2018.
a. Compute Iris Corporation's rehabilitation tax credit for 2018.
b. Calculate the cost recovery deductions for the building and the renovation costs for 2018.