Question

Your dear cousin - who is 30 years old, single, no kids, and a restaurant manager...

Your dear cousin - who is 30 years old, single, no kids, and a restaurant manager - heard that you are completing a course in Federal Income Tax Accounting at Henderson State University. She has asked you for help in preparing her 2018 tax return.

Additionally, she gave you the following list of what she considers to be "deductions." If the item is potentially a FROM AGI deduction, enter ID (for itemized deduction). If it not deductible, enter ND.  

Medical insurance premiums $1,900
Prescription drugs 250
Dentist 2,250
Emergency room fee 885
Cold pills, aspirin, and other OTC meds 120
Rental fee for crutches 80
Real estate taxes 1,600
State income taxes 2,300
Home mortgage interest 4,800
Credit card interest 1,375
Charitable contributions to church 2,050
Gambling losses ($0 in winnings) 300

Taking into consideration limitations on itemized deductions and a total AGI of $57,400, determine the total deductible items under each major category of itemized deductions. Type the amounts using commas and positive numbers.

Medical Deductions
Taxes
Interest
Charitable Deductions
Miscellaneous Itemized Deductions

Therefore, total itemized deductions are .

To minimize your cousin's tax liability, will you use itemized deductions or the standard deduction as her FROM AGI deductions? (Type itemized or standard in the blank provided.)

Homework Answers

Answer #1
AGI $57400
Medical insurance premiums 1900 ID
Prescription drugs 250 ID
Dentist 2,250 ID
Emergency room fee 885 ID
Cold pills, aspirin, and other OTC meds 120 ID
Rental fee for crutches 80 ID
Real estate taxes 1,600 ID
State income taxes 2,300 ID
Home mortgage interest 4,800 ID
Credit card interest 1,375 No
Charitable contributions to church 2,050 ID
Gambling losses ($0 in winnings) 300 No
Limit Eligible
Medical Deductions = 57400*10% = 5740 5,485
Taxes 3,900
Interest 4,800
Charitable Deductions = 57400*50% = 28700 2,050
Miscellaneous Itemized Deductions = (57400*2%) = In excess of $1,148 0
Total Itemized Deductions 16,235
Standard Deductions 12000
Itemized deductions is used
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
our cousin Albus Dumbledore, who is 30 years old, single and a restaurant manager, heard that...
our cousin Albus Dumbledore, who is 30 years old, single and a restaurant manager, heard that you have enrolled in the Masters-of-Taxation program at State University. He has asked you for help in preparing her 2019 tax return and provides you with the following information: Salary $50,000 Alimony received (Pre-2019 agreement) 3,600 Interest on GMAC Bonds 800 Interest on city of New Orleans bonds 1,300 Interest on a bank savings account 600 Berlinco, Inc. (a foreign corporation) (nonqualified dividend) 100...
1/ Linda, who files as a single taxpayer, had AGI of $280,000 for 2018. She incurred...
1/ Linda, who files as a single taxpayer, had AGI of $280,000 for 2018. She incurred the following expenses and losses during the year: Medical expenses (before the 7.5%-of-AGI limitation) $33,000 State and local income taxes 4,800 State sales tax 1,300 Real estate taxes 6,000 Home mortgage interest 5,000 Automobile loan interest 750 Credit card interest 1,000 Charitable contributions 7,000 Casualty loss (before 10% limitation but after $100 floor; not in a Federally declared disaster area) 34,000 Unreimbursed employee business...
Evan is single and has AGI of $277,300 in 2019. His potential itemized deductions before any...
Evan is single and has AGI of $277,300 in 2019. His potential itemized deductions before any limitations for the year total $52,300 and consist of the following: Medical expenses (before the AGI limitation) $29,000 Interest on home mortgage 8,700 State income taxes 9,500 Real estate taxes 3,600 Charitable contributions 2,500 After all necessary adjustments are made, what is the amount of itemized deductions Evan may claim? If required, round the medical deduction to the nearest dollar and use the rounded...
Emberlee is single and has AGI of $277,300 in 2020. Her potential itemized deductions before any...
Emberlee is single and has AGI of $277,300 in 2020. Her potential itemized deductions before any limitations for the year total $52,300 and consist of the following things: Medical expenses before AGI limitation $29,000 Interest on home mortgage $8,700 State income taxes $9,500 Real estate taxes $3,600 Charitable contributions $2,500 After all necessary adjustments are made, what is the amount of itemized deductions Emberlee may claim? Please clearly explain
Linda, age 37, who files as a single taxpayer, had AGI of $280,000 for 2017. She...
Linda, age 37, who files as a single taxpayer, had AGI of $280,000 for 2017. She incurred the following expenses and losses during the year: Medical expenses (before the 7.5%-of-AGI limitation) $33,000 State and local income taxes 4,500 State sales tax 1,300 Real estate taxes $4,000 Home mortgage interest 5,000 Automobile loan interest 750 Credit card interest 1,000 Charitable contributions 7,000 Casualty loss, Federally-Declared Disaster (before 10% limitation but after $100 floor) 34,000 Linda's total itemized deduction is $
Pedro, who is a single taxpayer, had AGI of $361,200 for 2017. He incurred the following...
Pedro, who is a single taxpayer, had AGI of $361,200 for 2017. He incurred the following expenses during the year: Medical expenses before 10%-of-AGI limitation $21,980 State and local income taxes $10,836 Real estate taxes $2,167 Home mortgage interest $18,060 Charitable contributions $4,334 Deductible investment interest expense $1,625 Compute the amount of Pedro's itemized deductions after any applicable reductions and/or limitations. Round your computations to the nearest dollar and use rounded amounts in subsequent calculations. $
Your client, Sadie Merriweather, is struggling to understand the changes in the tax law. She would...
Your client, Sadie Merriweather, is struggling to understand the changes in the tax law. She would like you to explain the changes to itemized deductions and personal exemptions, her personal information is as follows: Charitable Contributions $1,000 Mortgage Interest $7,300 Property Taxes $3,500 State Income Tax Paid in 2019 $15,000 Safety Deposit Rental Fee $500 Tax Preparation Fees $750 Medical Expenses $3,000 Sadie has two children ages 10 & 14 and files as Head of Household. Her only source of...
Which of the following is TRUE regarding the charitable contribution itemized deduction (ignore any AGI maximums)?...
Which of the following is TRUE regarding the charitable contribution itemized deduction (ignore any AGI maximums)? Frank is allowed to deduct the $100 he gave to a needy person begging outside the grocery store. Joe donated land he has owed for several years to a qualified charity (registered with the IRS).  Joe is allowed to take a charitable contribution deduction in the amount of the current value of the land, even though his cost is less than its current value. Armondo...
Linda, who files as a single taxpayer, had AGI of $280,000 for 2018. She incurred the...
Linda, who files as a single taxpayer, had AGI of $280,000 for 2018. She incurred the following expenses and losses during the year: Medical expenses (before the 7.5%-of-AGI limitation) $33,000 State and local income taxes 4,800 State sales tax 1,300 Real estate taxes 6,000 Home mortgage interest 5,000 Automobile loan interest 750 Credit card interest 1,000 Charitable contributions 7,000 Casualty loss (before 10% limitation but after $100 floor; not in a Federally declared disaster area) 34,000 Unreimbursed employee business expenses...
Exercise 10-21 (Algorithmic) (LO. 7) A) Issac has AGI of $93,800 and incurred the following expenses:...
Exercise 10-21 (Algorithmic) (LO. 7) A) Issac has AGI of $93,800 and incurred the following expenses: • Cost of uniforms required by his employer: $800 • Tax return preparation fees: $1,200 • Fee paid for a safe deposit box used to store papers and documents relating to taxable income-producing investments: $80 • Job-hunting costs: $2,400 Issac's deductible miscellaneous itemized deductions (after any limitation) on Schedule A is $. B)Issac has AGI of $93,800 and incurred the following expenses: • Cost...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT