Amanda has AGI of $111,000 before considering losses from some rental real estat

Question

Amanda has AGI of $111,000 before considering losses from some rental real estate she owns (she actively participates). She had the following losses from her rental property: Rental property 1 ($22,500) Rental property 2 (6,500) How much of the losses can Lucy deduct and how much of the losses are suspended?

Property 1_____

Property 2_____

If Amanda’s AGI before the losses was $69,000, how much of the losses can she deduct and how much of the losses are suspended?

Property 1______

Property 2______

Explanation / Answer

Since Amanda's gross income exceeds $100,000 her allowance needs to be reduced by $1 for every $2 her AGI exceeds $100,000

Threrefore 11,000/2 = $5500

hence $25,000 - $5,500 = $19,500 is deductibel and $9500 are susependible

( Allow losses in the ratio of 22,500: 6500)

(b) since her AGI is less than 100,000 , the allowance will be $25,000

Thus $25,000 allowed and $4000 suspended

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