Business, 26.02.2020 01:30 lilsmitty137ovf7yw

Mike and Pam own a cabin near Teluride, Colorado. In the current year the cabin was rented for 8 days to friends. Mike and Pam used the cabin a total of 82 days during the same year. After allocating the expenses between personal and rental use, the following rental loss was determined:

Rental income $700
Property taxes $230
Mortgage interest 300
Repairs and maintenance 100
Utilities 130
Rental loss $100

How should Mike and Pam report the rental income and expenses for last year?
a. Report the $100 loss for AGI.
b. Include the $700 in gross income, but no deductions are allowed.
c. Only expenses up to the amount of $700 rental income may be deducted.
d. Report the interest ($300) and taxes ($250) as itemized deductions and the other expenses for AGI.
e. No reporting for the rental activity is necessary.

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Mike and Pam own a cabin near Teluride, Colorado. In the current year the cabin was rented for 8 day...

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