Isabel Owns a Vacation Home in Hawaii

Isabel owns a vacation home in Hawaii.During the year she rented it out for one week and used it for personal purposes three weeks.Her expenses directly related to renting out the property were: rental commission ($30) and maid service ($25) .The allocated portion of taxes and interest was $400.Income from the rental was $300.Isabel should:

A) Report income of $300 and deduct $300 in expenses
B) Report income of $300 and deduct $455 in expenses
C) Report $300 of income and deduct no expenses
D) Report no income and deduct $400 along with her other itemized interest and taxes

Correct Answer:

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