Question

Toby Flenderson works in HR for one of your biggest clients. He suffers from arthritis so he sought the help of a chiropractor. The chiropractor advised him that he needs to swim daily to alleviate his pain and other symptoms. Toby purchases a new home with a swimming pool for $325,000, after selling his old home for $280,000. If Toby had constructed a pool at his former residence, it would have cost $55,000 to build and it would have increased the value of his home by $35,000. Toby is a member of the Dwight Schrute Gym for Muscles, which does not have a pool. The cost to join a different gym that has a pool is $45 per month.

List as many possible tax research issues as you can to determine whether Jo can deduct any of the current-year expenditures incurred because of her arthritis.

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

Answer 1

Calulation:-

Purchased a new home with swimming pool	$ 325000
Selling his old home	$280000
If constructed pool in old home before selling	$55000
Selling his home	280000+35000=315000
Gym joining	$ 45 per month

Here in the above table we can observe that the selling price is less than the purchasing price,i.e. there is a difference of 325000-280000=$45000

The difference amount toby would have taken a loan but its not reflected anywhere in the case study thats on tax issue.

answered by: anonymous