Answer:
She can write off up to $126,000 in depreciation
Explanation:
Step 1: Determine total gross income
The formula for the total gross income is;
T=agi+R
where;
T=total gross income
agi=adjusted gross income
R=rental revenue
In our case;
agi=120,000
R=10,000
replacing;
T=120,000+10,000=$130,000
Total gross income=$130,000
Step 2; Determine total net gross income
Total net gross income=total gross income-mortgage interest
total gross income=$130,000
mortgage interest=$4,000
Total net gross income=130,000-4,000=$126,000
She can write off up to $126,000 in depreciation
