Naomi and Matt received the following amounts from a tenant who is renting their condominium during the current year (rent is $1,500 per month) : $1,600\begin{array}{lll}\text {2 months rent }&\$2,200\\\text {Deposit }&1,600\\\end{array}$
Rent for two months would normally have been $3,000,but the tenant paid $800 for a plumbing repair.The repair would normally have been paid by Naomi and Matt but the problem occurred while they were out of town.How much should Naomi and Matt report as rental income for the current tax year?

A) $2,200
B) $2,400
C) $3,000
D) $4,600

Question

Naomi and Matt received the following amounts from a tenant who is renting their condominium during the current year (rent is $1,500 per month) :

1,600\begin{array}{lll}\text {2 months rent }&\$2,200\\\text {Deposit }&1,600\\\end{array}

Rent for two months would normally have been $3,000,but the tenant paid $800 for a plumbing repair.The repair would normally have been paid by Naomi and Matt but the problem occurred while they were out of town.How much should Naomi and Matt report as rental income for the current tax year?

A) $2,200
B) $2,400
C) $3,000
D) $4,600

Zybrea Knight · Accepted Answer

Final Answer : C, Explanation :  Naomi and Matt should report $3,000 as rental income. This includes the $2,200 received for two months' rent and the $800 that the tenant paid for the plumbing repair, which counts as rental income since it's a cost they would have normally covered. The deposit is not counted as income unless it is not returned to the tenant.

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