Charles and Sarah Own a Home in Palm Springs,CA

question 31

Multiple Choice

Charles and Sarah own a home in Palm Springs,CA.During the year,they rented the house for 40 days for $5,000 and used it for personal use for 18 days.The house remained vacant for the remainder of the year.The expenses for the house included $16,000 in mortgage interest,$4,500 in property taxes,$1,000 in utilities,$1,200 in maintenance,and $9,800 in depreciation.What is the deductible loss for the rental of their home (without considering the passive loss limitation) ? Use the Tax Court method for allocation of expenses.

• A)$0
• B)$5,000 net income
• C)$17,414 net loss
• D)$27,500 net loss

---

Definitions:

Memory Establishment

The process by which experiences are encoded and stored in the brain for later retrieval.

Lymphocytic Activation

The process by which lymphocytes (a type of white blood cell) increase in response to infection or disease.

Allergic Asthma

A type of asthma triggered by exposure to allergens, leading to inflammation and narrowing of the airways, causing difficulty in breathing.

Allergen-IgE Response

An immune system reaction where immunoglobulin E antibodies are produced in response to an allergy-causing substance.