Problem AlgorithmicLO
Melanie is employed fulltime as an accountant for a national hardware chain. She also has recently started a private consulting practice,
which provides tax advice and financial planning to the general public. For this purpose, she maintains an office in her home. Expenses
relating to her home for are as follows:
Real property taxes
Interest on home mortgage
Operating expenses of home
Melanie's residence cost $excluding land and has living space of square feet, of which square feet is devoted to
business. The office was placed in service in February and under the Regular Method, Melanie had an unused office in the home
deduction of $ for Assume there is sufficient net income from her consulting practice.
Click here to access the depreciation table. to use for this problem. Round your final answer to nearest dollar.
a What amount can Melanie claim this year for her office in the home deduction under the Regular Method?
b What is Melanie's office in the home deduction under the simplified Method?
