Exam 6: Individual Deductions

Ned is a head of household with a dependent son, Todd, who is a full-time student. This yea5r7N) ed made the following expenditures related to Todd's support: What amount can Ned include in his itemized deductions?

Rochelle, a single taxpayer (age 47), has an AGI of $275,200. This year, she paid medical expenses of $30,000, state income taxes of $4,000, mortgage interest of $10,600, and charitable contributions of $6,000. What would be the amount of her total itemized deductions that she may claim on her tax return?

The deduction for medical expenses is limited to the amount of unreimbursed qualifying medical expenses paid during the year reduced by two percent of the taxpayer's AGI.

Lewis is an unmarried law student at State University, a qualified educational institution.Last year Lewis borrowed $30,000 and used the proceeds to pay his university tuition. This year Lewis paid $1,500 of interest on the loan. Which of the following is a true statement if Lewis reports $40,000 of salary and no other items of income or expense?

Madeoff donated stock (capital gain property) to a public charity. He purchased the stock3 years ago for $100,000, and on the date of the gift, it had a fair market value of$200,000. What is his maximum charitable contribution deduction for the year related to this stock if his AGI is $500,000 (before considering the itemized deduction phase-out)?

The definition of qualifying expenses is more restrictive for the qualified educational expense deduction than it is for the education loan interest expense deduction.

Which of the following is a true statement?

Taxpayers filing single and taxpayers filing married separate have the same basic standard deduction amount.

Self-employed taxpayers can choose between claiming a deduction or a credit for the employer portion of self-employment taxes paid.

The deduction for investment interest in excess of the net investment income carries forward to the subsequent year.

Larry recorded the following donations this year:$500 cash to a family in need$2,400 to a church$500 cash to a political campaignTo the Salvation Army household items that originally cost $1,200 but are worth $300.What is Larry's maximum allowable charitable contribution if his AGI is $60,000?

Glenn is an accountant who races stock cars as a hobby. This year Glenn was paid asalary of $80,000 from his employer and won $2,000 in various races. What is the effect of the racing activities on Glenn's taxable income if Glenn has also incurred $4,200 of hobby expenses this year? Assume that Glenn itemizes his deductions but has no other miscellaneous itemized deductions.

Which of the following itemized deductions is not subject to the itemized deduction phase-out?

Mason paid $4,100 of interest on a loan that paid tuition for him to attend a privateuniversity this year. How much of this payment can Mason deduct as interest expense on an educational loan if he files single and reports modified AGI of $90,000?

Which of the following is a true statement?

To qualify as a charitable deduction the donation must be made by cash or by check.

Jim was in an auto accident this year. Jim paid $2,450 to repair his personal-use car after the accident and his insurance only reimbursed him $400. Jim bought his car several years ago for $1,500. What is the amount of casualty loss from this accident before Jim applies any casualty loss floor limitations?

Taxpayers are allowed to deduct mortgage interest on up to $1,000,000 of acquisition debt for their qualified residence and on up to $500,000 of home-equity debt.

Claire donated 200 publicly-traded shares of stock (held for 5 years) to her father's nonoperating private foundation this year. The stock was worth $15,000 but Claire's basis was only $4,000. Determine the maximum amount of charitable deduction for the donation if Claire's AGI is $60,000 this year.

Which of the following taxes will not qualify as an itemized deduction?