Question

**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 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 $.

C) Pedro, who is a single taxpayer, had AGI of $337,400 for 2017. He incurred the following expenses during the year:

Medical expenses before 10%-of-AGI limitation $19,580

State and local income taxes $10,122

Real estate taxes $2,024

Home mortgage interest $16,870

Charitable contributions $4,049

Deductible investment interest expense $1,518

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.

$

Answer #1

**Answer : Please note the Question A and B of Issac is
same so the answer for Question A and B is common .**

**Solution for Isaac :**

- You can deduct certain exepenses as miscellaneous itemized deductions on Schedule A (Form:1040 or Form:1040NR) , You can deduct the expenses limitation up to 2% of AGI .
- Here We can calculate the expenses frist so 800 + 1200 + 80 + 2400 = 4480 (Line 24 of schedule A) .
- Figure 2 % of isaac AGI . 0.02 * 93,800 = 1876 . now as per 2% of his AGI rule . Subtract 2% of his AGI from his Deductions that are the subject to the rule . 4480 - 1876 = 2604.
- Even though he had expenses of $4480 because these particular
exepenses is subject to the 2% rule , Isaac net deduction that he
will receive on his return for these expenditures is only
**$2604 .** **Issac's deductible miscellaneous itemized deductions (after any limitation) on Schedule A is $2604**

**Solution for Pedro :**

Issac has AGI of $73,400 and incurred the following expenses.
How much of the business and personal expenditures are deductible
(after any limitations) either as miscellaneous itemized deductions
or as other itemzied deductions?
Cost of uniforms required by his employer...... $535
Tax return preparation fees..... $600
Fee paid for a safe deposit box used to store papers and
documents relatating to taxable income-producing investments....
$65
Job-hunting costs...$1000

In 2018, Ava, an employee, who files single, has AGI of $58,000
and incurred the following miscellaneous itemized deductions this
year:
Home office expenses: $1,200
Union dues and work uniforms: $350
Unreimbursed employee expenses: $415
Gambling losses to the extent of gambling winnings: $890.
What is Ava’s total itemized deduction related to these
items

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c. incurred for tax advice relative to the preparation of an
individual’s income tax return.
d. Only a. and b. qualify.
e. A, b., and c. qualify.
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