Carmen owns a house that she rents out for $600 per month. Her expenses for the 2015 tax year are as follows:
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Real estate taxes
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$ 900
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Mortgage interest
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4,000
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Insurance
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300
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General repairs
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320
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Carmen bought the property in March of 1992, and her basis for depreciation on the house is $110,000. She uses straight-line depreciation with a 27 ½ -year life, so the depreciation on the house is $4,000. Calculate Carmen's net income or loss from renting the house if her gross rental income is $7,200 ($600 × 12 months).