temized Deductions (LO. 4) Rebecca and Irving incur the following medical expenses during the current year:...

temized Deductions (LO. 4)

Rebecca and Irving incur the following medical expenses during the current year:

Medical insurance premiums	$4,265
Hospital	915
Doctors	1,905
Dentist	550
Veterinarian	130
Chiropractor	210
Cosmetic surgery	1,430
Over-the-counter drugs	160
Prescription drugs	190
Crutches	95

They receive $4,065 in reimbursements from their insurance company of which $345 is for the cosmetic surgery.

Refer to Exhibit 8-2 to answer the following questions. What is their medical expense deduction if their adjusted gross income is the following:

a. Adjusted gross income of $40,000. Their medical expense deduction is $.

b. Adjusted gross income of $49,000. Their medical expense deduction is $.

Expert Solution

Part - (a)
Particulars	Amount ($)
Medical insurance premiums	$ 4,265
Hospital	915
Doctors	1,905
Dentist	550
Chiropractor	210
Prescription drugs	190
Crutches	95
Total Allowable medical expenses	$ 8,130
Less: Insurance reimbursements (4065-345)	-3720
Un-reimbursed medical expenses	$ 4,410
Less: AGI limitation ($40,000*10%) For 2019	-4000
Medical expense deduction	$ 410

Part - (b)
Particulars	Amount ($)
Medical insurance premiums	$ 4,265
Hospital	915
Doctors	1,905
Dentist	550
Chiropractor	210
Prescription drugs	190
Crutches	95
Total Allowable medical expenses	$ 8,130
Less: Insurance reimbursements (4065-345)	-3720
Un-reimbursed medical expenses	$ 4,410
Less: AGI limitation ($49,000*10%) For 2019	-4900
Medical expense deduction (No deduction)	$ 0
The AGI limit is higher than Un-reimbursed Medical Expense

ekkarill92 answered 2 years ago

1. Paul incurred $25,670 in legitimate, out-of-pocket medical expenses during the current year. His adjusted gross...

1. Paul incurred $25,670 in legitimate, out-of-pocket medical expenses during the current year. His adjusted gross income amounted to $83,560 this year, and he received a partial reimbursement of $9,412 from his insurance company. How much is his itemized deduction for medical expenses? 2. Amy is a single taxpayer living in Forest Hills, New York, with adjusted gross income of $69,057. Her employer withheld $7,761 in federal income tax, $4,901 in state income tax, and $2,709 in local income taxes...

Problem 3-4 (Algorithmic) Inventories (LO 3.2) Kevin owns a retail store, and during the current year...

Problem 3-4 (Algorithmic) Inventories (LO 3.2) Kevin owns a retail store, and during the current year he purchased $829,600 worth of inventory. Kevin's beginning inventory was $82,960, and his ending inventory is $99,552. During the year, Kevin withdrew $16,592 in inventory for his personal use. Assume that he uses the cost method to value the inventory and there was no change in determining quantities, costs, or valuations between opening and closing inventory. Use Part III of Schedule C below to...

For the current year (Y-4) Fabco has gross income of $100,000 and deductions of $110,000 for...

For the current year (Y-4) Fabco has gross income of $100,000 and deductions of $110,000 for regular tax purposes. Three years ago (T-1) taxable income was $5,000. Two years ago (Y-2) taxable income was $10,000. Last year (Y-3) taxable income was $300,000. Next year (Y-5) it is anticipated that taxable income will be $275,000. Assume alternative minimum tax does not apply. What are the tax consequences to Fabco in the current year (Y-4)? What alternatives does Fabco have?

In the beginning of the current year, Barry and Irving formed the BI Partnership by transferring...

In the beginning of the current year, Barry and Irving formed the BI Partnership by transferring cash and property to the partnership in exchange for a partnership interest, with each having a 50% interest. Specifically, Barry transferred property having a $40,000FMV, a $26,000adjusted basis, and subject to a $7,000liability, which the partnership assumed. Irving contributed $45,000cash to the partnership. The partnership also borrowed $29,000from the bank to use in its operations. All liabilities are recourse for which the partners have...

At the beginning of the current? year, Barry and Irving formed the BI Partnership by transferring...

At the beginning of the current? year, Barry and Irving formed the BI Partnership by transferring cash and property to the partnership in exchange for a partnership? interest, with each having a? 50% interest.? Specifically,Barry transferred property having a $70,000 ?FMV, a $38,000 adjusted? basis, and subject to a $9,000 ?liability, which the partnership assumed.Irving contributed $35,000 cash to the partnership. The partnership also borrowed $32,000 from the bank to use in its operations. All liabilities are recourse for which...

B is single and reports the following items of income and deductions for the current year:...

B is single and reports the following items of income and deductions for the current year: Salary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,000 Net long-term capital gain on sale of investment property. . . . . ....

1) Answer T or F for the following a) Medical expenses for the year are to...

1) Answer T or F for the following a) Medical expenses for the year are to be reduced by any insurance reimbursement that is expected to be received in the future in order to arrive at the current deduction. b) The full-cost of home-related capital expenditures paid to enable a physically disabled individual to live independently qualifies as a medical expense, but is still subject to the 10% of AGI floor limitation. c) Appraisal costs associated with determining the increase...

Daniel's adjusted gross income is $90,000. During the year he incurred $14,000 of medical expenses and...

Daniel's adjusted gross income is $90,000. During the year he incurred $14,000 of medical expenses and was reimbursed for $3,000 of these expenses. What is his allowable medical expense deduction if he is age 45, single, and itemizes? If this Daniel's only itemized deduction, should he itemize or claim the standard deduction? (2018)

Investment-Related Exclusions (LO. 6) Rona receives the following items during the current year: Interest on savings...

Investment-Related Exclusions (LO. 6) Rona receives the following items during the current year: Interest on savings account $600 Dividends on Microsoft stock 400 Interest on Guam development bonds 1,700 Dividend on life insurance policy 400 (The company is a mutual life insurance company, and the dividend is a return of part of the premium she paid on the policy.) In addition, Rona owns 1,600 shares of Cochran Corporation common stock. Cochran has a dividend reinvestment plan through which stockholders can...

Problem 10-54 (LO 10-2, LO 10-3) Convers Corporation (calendar-year-end) acquired the following assets during the current...

Problem 10-54 (LO 10-2, LO 10-3) Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table 2, and Table 5.) Date Placed Original Asset in Service Basis Machinery October 25 $ 110,000 Computer equipment February 3 $ 50,000 Used delivery truck* March 17 $ 63,000 Furniture April 22 $ 190,000 Total $ 413,000 *The delivery truck is not a luxury automobile. In addition to...

Question