Question

Required Information The following Information applies to the questlons displayed below.] Clem Is married and is a skilled carpenter. Clem's wife, Wanda, works part-time as a substitute grade school teacher. Determine the amount of Clem's expenses that are deductible for AGI this year (If any) under the following independent clrcumstances: (Leave no answer blank. Enter zero if applicable.) a. Clem Is self-employed and this year he incurred $525 in expenses for tools and supplies related to his job. Since nelther were covered by a qualified health plan, Wanda pald health insurance premiums of $3,600 to provide coverage for herself and Clem (not through an exchange). Deductible amount for AGI

Answer 1

Answer 1- $4125 ($525+$3600)- From adjusted gross income (AGI), all the above the line deductions are made while calculating AGI. In this case, both the health insurance premium and amount spent on tools related to their job is allowed to be deducted from AGI.

Answer 2- $0- Here no expense would be deducted a part of AGI. The reason is that the expenses they have incurred they are on garage which is an additional income to them. This is not part of their gross income.

Answer 3- $10650 ($7650+1500). While calculating AGI, only 50% of the taxes paid is allowed to be deducted. So, Clem paid self employment tax of $15300 and Wanda paid $3000 as tax. So, 50% of these amount is applicable to be deducted as part of AGI.

Answer 2

b- shoudl be allowed sinceit's rented = 2030

c- only emploer portion is alowed to be deducted. so SS allowed or full self employed. so the answear is 7650