Reference no: EM133925914
Case Scenario: Rental Property Dilemma Alex owns a condo purchased for $300,000 ($200,000 building, $100,000 land). In 2024, rental income is $18,000 (accrual basis). Expenses: $8,000 (interest on $150,000 loan), $4,000 (property taxes and utilities), $2,000 (repairs). The building is Class 1 (4% CCA rate). Alex handles minor repairs but hires a manager for tenants. In 2025, Alex sells the condo at a loss and the income source "disappears," but the loan remains. Get expert-level assistance in any subject with our assignment help services.
? Is this property or business income? Why?
? Calculate net rental income for 2024 (including max CCA).
? Can interest be deducted post-sale under the Disappearing Source Rule? Explain with reference to ITA 20.1(1).
? If short-term rentals (under 90 days) were involved without a permit for 30 of 100 rental days, how would deductions change (assume total expenses $14,000)?