Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.
Q: I rent out a dental office in my home. I am now an employee as I sold my practice to the dentist working there. Can I deduct my expenses of the office, for example, repairing the air conditioner, fixing the steps, any plumbing inside the office?
A: If you rent part of your property, you must divide certain expenses between the part rented and the part used for personal purposes, as if you has two separate properties. You may deduct expenses that belong to the rental, and you can deduct a portion of some expenses, such as mortgage interest and property taxes, as a rental expense. Income and expenses are reported on Schedule E. The passive activity rules for rental activities may apply as well. For more information consult IRS publication 527.
Q: My husband died in 1993 and I received a 1099 dividend statement for stock held jointly in 1994. It was transferred to my name in the middle of 1994 but this 1099 DIV form has his name and Social Security number on it. How do I report this on my tax return, especially since it has his Social Security number on it?
A: Property which is held jointly by married couples generally passes directly, upon death, to the surviving spouse. Assuming that's the case, you must report all dividend income on your 1994 return, regardless of the Social Security number on the Form 1099.
The above advice is for general purposes only and is not intended as legal, accounting or tax advice. Specific situations may vary.
Members of the Maryland Association of Certified Public Accountants will answer tax questions from readers until April 15 and also offer a Tax Tip of the Week.
To submit a question, call Sundial, The Sun's telephone information service, at (410) 783-1800. In Anne Arundel County call 268-7736, in Harford County 836-5028, and in Carroll 848-0338. Using a touch-tone phone, enter 6225 after the greeting. Push 1 to submit a tax question; state the question in full. Push 2 to hear the tax tip. Selected questions will be answered in the Business section. No questions will be answered by phone.