Jordan is a manager at Big Box Corporation . His Form W-2 wages are $ 68,000 and federal income tax withheld is $ 8,300 . The correct payroll taxes were withheld . Diana worked at a local department store for the first half of the year . Her Form W-2 wages are $ 40,000 and federal income tax is $ 3,300 . The correct payroll taxes were also withheld . The Diego family paid $ 9,200 interest on their home mortgage ( reported to them by the mortgage company on Form 1098 ). The Diego family also owns a vacation home in Breckenridge , Colorado , for which they paid $ 4,100 of mortgage interest . ( This is qualified mortgage interest for a second home .) The Diego family paid real estate taxes on their principal residence of $ 3,400 , $ 2,000 of real estate taxes on their vacation home and $ 3,200 of sales taxes during the year . The vacation home in Breckenridge was rented out for 120 days during the year for which they received $ 12,000 in rental income . Jordan and Diana made significant decisions such as approving new tenants while a local management company handled the day-to-day needs . The Diego family used it for 30 days for a personal vacation during the year . Other expenses for the year for this vacation home ( excluding interest and taxes mentioned above ) were : $ 700 for real estate management fees paid to a local agent who handles the rental of the property , insurance expense $ 2,200 , repairs expense $ 500 , and utilities expense $ 1,800 . Their depreciation expense for the rental use of this property for the year is $ 1,455 . They use the IRS formula for allocating interest and taxes . The Diego family contributed $ 3,000 cash to their church and they have the necessary documentation for this contribution . Jordan had the following employment-related expenses that were not reimbursed by his employer : Jordan drove his BMW ( which he purchased four years ago on November 18 ) a total of 12,000 miles during the year . He drove 4,800 miles while conducting business during the first half of the year . In July , the firm purchased several hybrid autos that the architects were then required to use for all business travel rather than their personal