What would be able to claim extra tax deductions of

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Nancy is employed by a large corporation as a sales representative. She is paid a salary of $70,000 during 2019. She is required to have a home office and uses the 375 square foot den in her 1,500 square foot house exclusively for this purpose. Total costs for 2019 were as follows:

Mortgage payments (40% principal, 60% interest) $24,000

Home owner's insurance 900

Utilities 1,500

Roof repair 800

Property tax 5,000

Question 1: As Nancy's compensation does not include any commissions, she is unable to use some of these costs as tax deductions. If instead, her compensation of $70,000 was in the form of commissions, she would be able to claim extra tax deductions of:

Option 1: $1,675

Option 2: $5,075

Option 3: $3,600

Option 4: $1,475

Reference no: EM132535127

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