Question

Linda Larue has arthritis. Her chiropractor advised her that she needed to swim daily to alleviate her pain and other symptoms. Consequently, Linda and her husband, Philo, purhcased for $400,000 a new home that had a swimming pool, after selling their home for $325,000.00. If the Larues had constructed a pool at their former residence, it would have cost $75,000 to build, and it would have increased the value of their home by $50,000.

a. List as many possible tax reasearch issues as you can to determine whether the Larues can deduct any of their current-year expenditures for Linda's arthritis.

b. After completing your list of tax issues, list the keywords you might use to construct an online tax research query.

c. Execute an online search using your query. For simplicity, select the IRS Revenue Rulings database from whichever online tax service you use. Summarize your findings.

Answer 1

1. Linda Can claim several expenditure related to House purchase such as interest paid on home purchased otherwise it can calim 75000$ which cost for constructing swimming pool which is nothing but the addition for expansion.

the cost incurred can be used as the cost of acquition for the value of the asset purchase and the sale of existing home will add the capital gain or loss based on the cost of acquisition of the home.

2. Purchase of House , sale of house, expansion.

3. what is online search query and not clear in it and the IRS revenue rulings are database.

the findings are the benefits derived either purchasing the house and selling of current home or Expansion of the existing home for construction of Swimming pool.