Exam 7: Itemized Deductions

A review of the 2017 tax file of Gregory,a single taxpayer who is age 40,provides the following information regarding Gregory's 2017 tax status: In 2018,Gregory receives a reimbursement for last year's medical expenses of $1,200.As a result,Gregory must

Discuss what circumstances must be met for personal property taxes to be deductible.

Legal fees for drafting a will are generally deductible.

Mitzi's medical expenses include the following: Mitzi's AGI for the year is $33,000.She is single and age 49.None of the medical costs are reimbursed by insurance.After considering the AGI floor,Mitzi's medical expense deduction is

When are points paid on a loan deductible as interest expense?

A medical expense is generally deductible only in the year in which the expense is actually paid.

Special documentation rules apply to donation of

Explain how tax planning may allow a deduction of qualified medical expenses.

Doris donated a diamond brooch recently appraised at $25,000 to her local church.Doris had purchased it many years ago for $10,000.The church sold the brooch to provide funding for church programming.Doris' AGI is $40,000.Doris will be able to take a charitable deduction of

Arun paid the following taxes this year: What amount can Arun deduct as an itemized deduction on his tax return?

For non-cash charitable donations,an appraisal will be required for donations valued at more than

A taxpayer has made substantial donations of both cash and capital gain property.Due to lower income this year,the taxpayer could exceed the charitable contribution ceilings.The taxpayer will apply the 50% AGI ceiling before applying the 30% AGI ceiling.

Medical expenses paid on behalf of an individual who could be the taxpayer's dependent except for the gross income or joint return tests are deductible as itemized deductions.

Assessments or fees imposed by the government for specific privileges or services are not deductible as taxes.

If a prepayment is a requirement for the receipt of the medical care,the payment is deductible in the year paid rather than the year in which the care is rendered.

Interest expense incurred in the taxpayer's trade or business is deductible as a for AGI deduction without limitation if the taxpayer materially participates in the business.

Faye earns $100,000 of AGI,including $90,000 of salary and $10,000 of interest income.Faye does itemize her deductions.The miscellaneous category of her itemized deductions consists of $1,500 of unreimbursed employee business expenses and a $900 fee paid for investment advice.Faye has paid $11,000 of interest expense on a loan used to purchase stocks.How much of the $11,000 interest expense can be deducted this year?

On September 1,of the current year,James,a cash-basis taxpayer,sells his cottage to Bill,also a cash-basis taxpayer,for $100,000.James' basis in the cottage is $65,000.The real property tax year is the calendar year.Real estate taxes on the property for the year are $3,650 and are payable in November of the current year.The sales agreement does not provide for apportionment of real estate taxes between the buyer and seller.Assume Bill pays all of the real estate taxes in the current year.The effects of this sales structure will be

Foreign real property taxes and foreign income taxes are not deductible as itemized deductions.

What is the result if a taxpayer makes a contribution to a college or university and in return receives the right to purchase tickets to athletic events?