Exam 6: Business Expenses

Lynn is a sales representative for Textbook Publishing Company. He receives a monthly travel allowance from Textbook to cover his travel costs (transportation, food, lodging, entertainment, etc.). If Lynn is not required to account to Textbook for the use of the travel advance I.Lynn will not have to show any aspect of the travel reimbursement or expenses incurred if he spends all of the reimbursement on valid travel expenses. II.To the extent Lynn is reimbursed for his costs he will get a deduction for AGI.​

Which of the following taxes paid by the Fowlers Company can be deducted during 2018? I.State sales tax on utilities. II.Federal income tax paid in 2018 when filing Fowlers' 2017 corporate tax return. ​

Carla, a single taxpayer, has taxable income of $250,000. Included in her taxable income is income from her consulting business that is operated as a S Corporation. Mary, a single taxpayer, has taxable income of $120,000. Included in her taxable income is income from her consulting business that is operated as a S Corporation. Which of the taxpayers can use the Qualified Business Income (QBI) deduction? I.Carla can take the QBI deduction II.Mary can take the QBI deduction. ​

Matthew, a single taxpayer with adjusted gross income of $90,000, works as a computer programmer for the Novak Corporation. The corporation reimburses all its employees 50% of tuition, fees and books for courses taken at the local university. Matthew incurs $6,000, is reimbursed $3,000, and can deduct the remaining $3,000 of the education expense ? I.As a deduction for adjusted gross income. II.Only if the course is required by state law to continue in his current job.

Fred and Irma are married with salaries of $49,000 and $44,000, respectively. Their combined AGI is $111,000. Both are active participant in their companies' qualified pension plans. Determine their maximum combined IRA contribution and deduction amounts? ? Maximum Maximum Contribution Deduction A) \ 5,500 \ 2,750 B) \ 11,000 \ 2,750 C) \ 11,000 \ 5,500 D) \ 11,000 \ 7,500 E) \ 11,000 \ 11,000 Contribution Deduction

Deductions for adjusted gross income include I.Student loan interest. II.Unreimbursed employee business expenses for a nonaccountable plan. ​