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18 December, 01:44

Brad and Kate received $9,500 for rent from Mike and Janet, who are renting their home in Santa Ana, California. Brad and Kate did not use this property for personal use. The rent covers eight months from August 1 of the current year to March 31 of the following year. The amount also includes a security deposit of $1,500,. How much should Brad and Kate report as rental income in the current tax year?

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  1. 18 December, 02:06
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    So 1500 is security deposit so after subtracting it from the rent now rent is $ 8000 for 8 months which means $1000 per month. So the months left for current year are 5 means from August to December. so the rent for 5 months is $5000. Brad and kate will report $5000 as rental income in the current tax year.
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