Problem 10-43 (a) (LO. 2, 3, 4, 5, 6, 7, 8) Stacey files as head of household wi
ID: 2524321 • Letter: P
Question
Problem 10-43 (a) (LO. 2, 3, 4, 5, 6, 7, 8)
Stacey files as head of household with two dependents. She has AGI of $123,000 for 2017. She incurred the following expenses and losses during the year:
Stacey's total itemized deductions before any phaseout are $.
Stacey's total itemized deduction is $.
Medical expenses before the 10%-of-AGI limitation $12,500 State and local income taxes 7,200 State sales tax 1,400 Real estate taxes 2,800 Home mortgage interest 5,900 Credit card interest 1,100 Charitable contribution 2,400 Casualty loss before 10% limitation (after $100 floor) 8,300 Unreimbursed employee expenses subject to the 2%-of-AGI limitation 5,500Explanation / Answer
Following assumption are taken
The calculation Stacey's total itemized deduction and before any phaseout are given below
Allowable
Before Phase Out
Medical Expenses
12500
12500
Less: 10% AGI
12300
Allowable Deduction
200
Taxes Paid
State and Local Income Taxes
7200
7200
State Sales Tax
1400
1400
Real Estate Tax
2800
2800
Home Mortgage Interest
5900
5900
Charitable Contributions
2400
2400
Casualty Loss
8300
8300
10% AGI
12300
0
Unreimbursed Expense
5500
5500
2% AGI
2460
3040
Total
22940
46000
Allowable
Before Phase Out
Medical Expenses
12500
12500
Less: 10% AGI
12300
Allowable Deduction
200
Taxes Paid
State and Local Income Taxes
7200
7200
State Sales Tax
1400
1400
Real Estate Tax
2800
2800
Home Mortgage Interest
5900
5900
Charitable Contributions
2400
2400
Casualty Loss
8300
8300
10% AGI
12300
0
Unreimbursed Expense
5500
5500
2% AGI
2460
3040
Total
22940
46000
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