Question

Required information [The following information applies to the questions displayed below.] In each of the following independent cases, indicate the amount (1) deductible for AGI, (2) deductible from AGI, and (3) deductible neither for nor from AGI before considering income limitations or the standard deduction. (Leave no answer blank. Enter zero if applicable.) a. Fran spent $119 for uniforms for use on her job. Her employer reimbursed her for $94 of this amount under an accountable plan (and did not report the reimbursement as wages). Deductible for AGI Deductible from AGI Not deductible b. Timothy, a plumber employed by ACE Plumbing, spent $80 for small tools to be used on his job, but he was not reimbursed by ACE. Deductible for AGI Deductible from AGI Not deductible c. Jake is a perfume salesperson. Because of his high pay, he receives no allowance or reimbursement from his employer for advertising expenses even though his position requires him to advertise frequently. During the year, he spent $2,450 on legitimate business advertisements. Deductible for AGI Deductible from AGI Not deductible d. Trey is a self-employed, special-duty nurse. He spent $385 for uniforms. Deductible for AGI Deductible from AGI Not deductible e. Mary, a professor at a community college, spent $730 for magazine subscriptions. The magazines were helpful for her research activities, but she was not reimbursed for the expenditures. Deductible for AGI Deductible from AGI Not deductible f. Wayne lost $425 on the bets he made at the race track, but he won $83 playing slot machines. Deductible for AGI Deductible from AGI Not deductible

Answer 1

Answers:

a.

Deductible for AGI
Deductible from AGI	25
Not deductible

$0 for AGI. $25 from AGI which is miscellaneous itemized deduction as unreimbursed employee business expense. Income and expenses associated with the $94 reimbursement offset each other. And the accountable plan only reimburses deductible expenses.

b.

Deductible for AGI
Deductible from AGI	80
Not deductible

$80 is deductible from AGI : miscellaneous itemized deduction as unreimbursed employee business expense

c.

Deductible for AGI
Deductible from AGI	2450
Not deductible

$2,450 is deductible from AGI: miscellaneous itemized deduction as unreimbursed employee business expense

d.

Deductible for AGI	385
Deductible from AGI
Not deductible

$385 is deductible for AGI: trade expenses assuming that uniforms for special duties cannot be adapted for normal use

e.

Deductible for AGI
Deductible from AGI	730
Not deductible

$730 fom AGI as miscellaneous itemized deduction is treated as unreimbursed employee business expense

f.

Deductible for AGI
Deductible from AGI	83
Not deductible	342

$83 deductable from AGI is miscellaneous itemized deduction which is an unreimbursed employee business expense. And that is not subject to 2% floor. Also Wayne has gambling losses. His gambling loss deduction is limited to his wins.