For a Home to Be Considered a Rental (Nonresidence)property, a Taxpayer

question 19

Multiple Choice

For a home to be considered a rental (nonresidence) property, a taxpayer must:

• A)rent the property for 15 days or more during the year.
• B)use the property for personal purposes for no more than the greater of (a)14 days or (b)10 percent of the total days rented.
• C)use the property for personal purposes for no more than the lesser of (a)14 days or (b)10 percent of the total days rented.
• D)rent the property for 1 day or more during the year and use the property for personal purposes for no more than the greater of (a)14 days or (b)10 percent of the total days rented.
• E)rent the property for 15 days or more during the year and use the property for personal purposes for no more than the lesser of (a)14 days or (b)10 percent of the total days rented.

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Definitions:

Straight-Line Method

A method of calculating depreciation of an asset by evenly spreading its cost over its expected useful life.

Salvage Value

The estimated residual value of an asset after its useful life has ended and it can no longer be used for its originally intended purpose.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting how much of the asset's value has been used up during a specific period.

Useful Life

The estimated period over which an asset is expected to be utilizable or productive before it is fully depreciated.