home_office_deduction_solution

home_office_deduction_solution - Solution: Home office...

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Solution : Home office deduction Ashley works as a full-time employee for a local company. She also operates a mail order business out of her home and maintains an office in her home that is used exclusively for business. The size of her home is 2,400 square feet and her office is 300 square feet. During the year her mail order business generated gross income of $18,000 and she had $6,000 of business expenses such as supplies and shipping charges. In addition, she reported the following information: Painting of the office 1,500 Mortgage interest (total) 3,200 Property taxes (total) 1,800 Insurance (total) 600 Utilities (total) 2,400 Depreciation (total) 800 Required : [1] How much can Ashley deduct for her use of the home office this year? What is her profit or loss from her mail order business? [2] Assume Ashley generates only $8,000 of gross income from her business. How much can Ashley deduct for her use of the home office this year? What is her profit or loss from her mail order business?
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This note was uploaded on 09/09/2011 for the course TAX 6845 taught by Professor Kelliher,c during the Fall '08 term at University of Central Florida.

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home_office_deduction_solution - Solution: Home office...

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