Question

22. 24. and 25

CCH Federal Taxation-Comprehensive Topics PROBLEMS 22. For the current year, Al Johnson used his personal car for both business and personal purposes. He drove 18,000 miles in the car during the year: 10,000 miles were for business-related purposes and 8.000 miles were for personal purposes. He incurred the following car expenses during the year: Expense Amount $7900 900 Maintenance Repairs and depreciation Car washes Total $10 200 Based on this information, what part of the above car expenses is deductible as business- related expenses on Al's current year income tax return? 23. Refer to the facts in Problem 22 but assume that Al's total car expenses amounted to only $4,700. What is the amount of Al's car expense deduction on his current year tax return? .24. Indicate whether the following expenditures are trade or business deductions (T). production of income deductions (PI). personal deductions (P), or are not deductible (X). Also indicate if the deductible expenditures are deductible "For" or "from" AGI. a. Business advertising b. Interest expense on home mortgage c. Union dues of employee d. Bank service charges on business checking account e. Entertainment expenses of a sales representative paid on commission 25. Indicate whether the following expenditures are trade or business deductions (1), production of income deductions (PD). personal deductions (P), or are not deductible (X). Also indicate if the deductible expenditures are deductible "for" or "from" AGI. a. Interest expense on business loan b. Expenses incurred in an activity lacking a true profit motive (ie, a hobby activity) c. Commuting expenses of individual taxpayer d. Rent payments paid by an illegal gambling business e Payment to bribe government official made by a business

25 please

Answer 1

Answer 25 :

a. Interest Expense on Business loan : Business Deduction (T) , deductible

b. Expenses incurrend in an activity lacking a true profit motive : Personal Deduction , not deductible

c. Commuting expensditure of Individual tax payers : Production of Income deduction , deductible

d. Rent payments made by illegal gambling business : Not deductibke

e. payment to bribe government official made by a business : Not deductible