Exam 5: Itemized Deductions and Other Incentives

During the current year, Hom donates a sculpture that cost $1,000 to a museum for exhibition. The sculpture's fair market value was $1,700 on the date of the donation, and Hom's adjusted gross income is $40,000. a.​ If Hom had held the sculpture for 4 months and the $700 ($1,700 - $1,000) of appreciation would have been a short-term capital gain, calculate the amount of his itemized deduction for the contribution. b.​ If Hom had held the sculpture for 2 years and the $700 gain would have been a long-term capital gain, calculate the amount of his itemized deduction for the contribution.

During the current year, Mary paid the following expenses: What is the total amount of medical expenses (before considering the limitation based on adjusted gross income) that would enter into the calculation of itemized deductions on Mary's current year income tax return?

Frank is a resident of a state that imposes a tax on income. The following information pertaining to Frank's state income taxes is available: What amount should Frank use as state and local income taxes in calculating itemized deductions for his 2015 Federal tax return, assuming he elects to deduct state and local income taxes?

If 2014 tax law is extended into 2015, state sales taxes can be deducted in lieu of state income taxes.

April and Wilson are married and file a joint tax return. Wilson is a police officer, and in the current tax year he spends $400 on uniforms and $160 for dry cleaning the uniforms. April is in the National Guard and military regulations restrict her from wearing her uniforms when she is off duty. The cost of uniforms for the year was $220 and the cost of dry cleaning them amounted to $80. April was granted a uniform allowance of $180 for the year. She also purchased a pair of standard black shoes to wear while on duty that cost $75. How much may they deduct on Schedule A for special clothing and uniforms, before considering the 2 percent of adjusted gross income limitation? ​

If a ballet dancer seeks work as a ditch digger, the expenses of job hunting may be deductible.

The cost of a fishing license is considered a personal property tax and is deductible as an itemized deduction.

Tom is employed by a large consulting firm. His employer has an accountable expense reimbursement plan. Tom paid for $3,000 of travel expenses which were directly reimbursed under the plan. How will the travel expenses be treated in Tom's tax return?

Gwen has written acknowledgments for each of the following charitable contributions during the current year: What is Gwen's charitable contribution deduction for the current year?

Phillip, a single parent, would like to contribute $1,800 to an educational savings account for his 10-year-old son. His AGI is $98,000. Calculate the amount of the contribution he can make.

Which one of the following is not tax deductible?

Which of the following is a miscellaneous itemized deduction?

Which of the following is not deductible as an itemized deduction?

Which of the following is true with respect to an education incentive?

The amount of a special assessment charged to residents for the installation of sidewalks on their street is not deductible on Schedule A as property taxes.

Matthew purchases a new principal residence in the current year and pays points of $2,000 to obtain a mortgage loan. What is the proper tax treatment for the points paid?

Damage resulting from which of the following would probably not give rise to a casualty loss deduction?

Andy borrows $20,000 to invest in bonds. During the current year, his interest on the loan is $2,000. Andy's interest income from the bonds is $400 and his investment expenses are $300. a.Calculate Andy's itemized deduction for investment interest for this year. b.Is Andy entitled to a deduction in future years?

​Perry Mayson, a single taxpayer, graduated law school last year with quite a bit of qualified student loan debt and ends up paying $4,300 in interest on the loan in the current tax year. Fortunately, Perry is well compensated and earns adjusted gross income of $85,000 during the current year. Perry may deduct his student loan interest in the current year.

During 2015, Sarah, age 29, had adjusted gross income of $12,000 and paid the following amounts for medical expenses: In 2015, Sarah drove 113 miles for medical transportation in her personal automobile, and she uses the standard mileage allowance. Her insurance company reimbursed Sarah $300 during the year for the above medical expenses. Using the schedule below, calculate the amount of Sarah's deduction for medical and dental expenses for the 2015 tax year.