a) Chuck, who is 33 and single, has an AGI of $377,000 during 2017. He incurred...

a) Chuck, who is 33 and single, has an AGI of $377,000 during 2017. He incurred the following expenses and losses during the year. Compute his allowed itemized deductions for 2017.

Medical expenses before 7.5% of AGI limit	$42,000
State and Local Income Taxes	$8,500
State Sales Tax	$2,700
Real Estate Property Tax	$7,500
Home Mortgage interest	$16,000
Charitable contribution to church	$6,750
Casualty loss before 10% limitation (after $100) floor	$50,000
Unreimbursed employee expenses subject to 2% of AGI limitation	$9,400
Gambling losses (Chuck has $3,500 of gambling income)	$4,800

b) Clara, age 72 and single, is claimed as a dependent on her son’s tax return. During 2017, she had dividend income of $2,500 and $1,900 of earned income from housecleaning. What is her taxable income?

c) Cecil incurred $60,000 of interest expense related to his investments in 2017. His investment income included $30,800 of interest and a $24,200 net long term capital gain on the sale of securities. Cecil has asked you to compute the amount of his deduction for investment interest, taking into consideration any options he might have. What is the maximum amount of Cecil’s investment interest deduction in 2017?

Expert Solution

answer calculation of itemwize deduction
Medical expenses before 42000-(10%*377000)	4300
Deductible Itemwize deduction subject to overall limitation	44685
Casualty loss before 50000-(10%*377000)	$12,300
Gambling losses (Chuck has $3,500 of gambling income)	$4,800
Total itemwize deduction	$66,085


working
Medical expenses before 42000-(10%*377000)	4300
State and Local Income Taxes	$8,500
State Sales Tax	$2,700
Real Estate Property Tax	$7,500
Home Mortgage interest	$16,000
Charitable contribution to church	$6,750
Casualty loss before 10% limitation (after $100) floor	$50,000
Unreimbursed employee expenses subject to 2% of AGI limitation	$9,400
Gambling losses (Chuck has $3,500 of gambling income)	$4,800

He is a single sand $377000 is his AGI so $261500 limiltation applied on certain items for itemwized deduction
State and Local Income Taxes	$8,500
Real Estate Property Tax	$7,500
Home Mortgage interest	$16,000
Charitable contribution to church	$6,750
Unreimbursed employee expenses subject to 2% of AGI limitation	$9,400
Total	$48,150
Whichever is less
(3%*(377000-261500)	3465
Or 80%*48150	$38,520
Amt of reduction	3465
Deductible Itemwize deduction subject to overall limitation	44685
(48150-3465)

Dera student there are three different question. I have answered the first one

ekkarill92 answered 1 year ago

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