Chapter 7 Tax Flashcards
Taxpayers are not allowed to receive a moving allowance from their employers. 71. Gambling losses to the extent of gambling winnings. Fees for investment advice.
Lodging while en route 4. The cost of gasoline when traveling to the new residence 5. One-half of the cost of meals while en route to the new residence A. Numbers 1, 2, and 4 only.
This fall Manfred enrolled in the law school at State University and paid $6,200 in tuition. Until his enrollment Manfred worked as a stock broker and this year he reports $70,000 in wages. Manfred can deduct half of his tuition for AGI. B. Manfred can deduct half of his tuition as a miscellaneous itemized deduction.
Tax final exam
Payments to a hospital. Transportation for medical purposes. The cost of insurance for long-term care services. All of these are deductible as medical expenses. 72. Medical expenses are subject to the phase-out of itemized deductions.
B. Millie can deduct $1,667 for AGI. C. Millie can deduct $2,400 as an itemized deduction. Millie can deduct $2,000 as an itemized deduction. 31. The deduction for interest on educational loans is subject to a phase-out limitation. The deduction for moving expenses is subject to a phase-out limitation.
- The maximum deduction for interest expense on qualified education loans is $6,000.
- None of the choices are correct because all prizes are excludible.
- She also claims $410 of nonrefundable personal credits, $705 of refundable personal credits, and $210 of business credits.
- The deduction for qualifying education interest is $1,200.
- Personal casualty losses are subject to a per casualty floor limitation and an aggregate floor limitation of 10 percent of AGI.
49,000 d. 32,000 e. Zero- Deb was not solvent when the loan was discharged. B. A married filing joint taxpayer with AGI of $500,000 would not be able to deduct personal and dependency exemptions. Andres and Lakeisha are married and file joint. Andres is 72 years old and in good health.
This year Grace paid university tuition of $12,000. Grace can deduct all of her tuition for AGI as a business expense. Grace can deduct all of her tuition as a miscellaneous itemized deduction. Grace can only deduct half of her tuition for AGI as a business expense.
The phase-out of itemized deductions cannot reduce itemized deductions to zero. Miscellaneous itemized deductions are not subject to the phase-out of itemized deductions. The phase-out of itemized deductions does not apply if personal exemptions are subject to a phase-out. 51. All of the above are deductible as medical expenses.
Another question on Business
This year, fixed expenses are expected to remain at $120,000 and sales are expected… $60,000 For loans occurring before December 16, 2017, interest on up to $1,000,000 of acquisition debt is deductible. In 2018, interest on home equity indebtedness is not deductible. Here all the debt is acquisition indebtedness and she may deduct interest on $1,000,000 of the $1,240,000 debt. That amount is then multiplied by the business use percentage to obtain $6,800 ($10,000 × 68%).
The taxi was repaired at a cost of $2,675 and insurance reimbursed Don $721 of this cost. What is the amount of Don’s casualty loss deduction? $929 B.
charitable contribution if his AGI is $60,000?
None of the above costs is deductible. 21. Medical expenses incurred to prevent disease. None of these costs is deductible.
50. This fall Millie finally repaid her student loan. She originally borrowed the money to pay tuition several years ago when she attended at State University . This year Millie paid a total of $2,400 of interest on the loan. Millie can deduct $2,400 for AGI.
State, local, and foreign income taxes. Real estate taxes on a residence. Gasoline taxes on personal travel. None of the above qualifies as an itemized deduction.