Oregon Tax Consultants Practice Exam

What types of expenses are included in keeping up a home?

1. Life Insurance, Rent, Food, Utilities

2. Repairs, Mortgage Interest, Real Estate Taxes, Rent

3. Transportation, Utilities, Insurance, Repairs

4. All of the above

The correct answer is: Repairs, Mortgage Interest, Real Estate Taxes, Rent

The correct answer is focused on expenses that are directly related to maintaining a home. This includes repairs, mortgage interest, real estate taxes, and rent, which are all considered essential costs associated with homeownership or tenancy. Repairs cover the costs of maintaining the property, ensuring that it is safe and habitable. Mortgage interest is a significant expense for homeowners, as it reflects the cost of borrowing money to purchase the home. Real estate taxes are mandatory payments based on the assessed value of the property, contributing to local government funds. Rent, for those who lease their homes, is a major recurring expense that is necessary for the right to inhabit a dwelling. This combination of expenses reflects the financial obligations homeowners and renters face in order to maintain their living situation, without straying into broader categories of living costs like food or transportation. Each component directly contributes to the home environment, making the selection appropriate in the context of home maintenance.