Rental income of personal income taxes system in the us. is, Ask an Expert

Accounting

Jerry, a general contractor by trade, is a tenant of Montgomery Apartments. In exchange for four months rent ($900/month), Jerry provided the following items and services for Paul, the owner of the apartments:

Paint and miscellaneous supplies for the apartments $ 700
Labor for painting and miscellaneous repairs 1,000
Labor and supplies for paving the apartment parking area 1,900

How should Paul treat this transaction on his 2008 Schedule E?

a. Rental income of $3,600 and rental expenses of $3,600.

b. No rental income or rental expenses are to be reflected on the Schedule E because the net effect is 0.

c. Rental income of $3,600 and depreciation computed on the capital expenditures of $3,600.

d. Rental income of Personal income taxes system in the US. Is it a progressive taxation system? Why or why not?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9449599

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