Bruce Is Employed as an Executive and His Wife,Marie,is a Self-Employed

Bruce is employed as an executive and his wife,Marie,is a self-employed realtor.Besides Bruce's salary,Bruce and Marie own a warehouse that they rent to a local business for storage.This year they paid $1,250 for electric service in the warehouse.Marie also paid self-employment tax of $6,200 and Bruce had $7,000 of Social Security taxes withheld from his pay.Marie paid $45 fee to rent a safe deposit box to store records associated with her realty operation.Which of the following is a true statement?

A) One-half of the social security tax is deductible for AGI.
B) Only the electric bill is deductible for AGI.
C) The self-employment tax is not deductible.
D) The safe deposit fee and the electric bill are deductible for AGI.
E) None of these is truE.The safe deposit fee and electric bill are rental expenses.The employer portion of the self-employment taxes is deductible for AGI.

Correct Answer:

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