Question

Tor F 1. For 2018, the amount of the student loan interest deduction is limited to $3,500. Tor F 2. Under a divorce agreement executed in 2018, periodic payments of either cash or property must be made at regular intervals to be deductible as alimony. Tor F 3. With a Health Savings Account (HSA), contributions grow tax free and distributions used for to pay for medical expenses are non-taxable. Tor F 4 . The cost of aspirin and over-the-counter cough medicine is a deductible medical expense. Tor F 5. Taxpayers can deduct qualified residence interest on their principal residence and on a second residence selected by the taxpayer if debt is $1,000,000 or less. T or F 6. In order to deduct a charitable contribution, taxpayers must itemize on their return Tor F 7. Fines paid that are ordinary, necessary and reasonable in a trade or business are deductible. T or F 8. The luxury auto limits on depreciation must be reduced if business use is less than 100%. Tor F 9. The standard mileage rate includes parking fees, tolls, and property taxes on the vehicle. T or F 10. Transportation costs are deductible when a taxpayer goes to a business meeting away from his or her regular workplace.

Answer 1

1. The most student loan interest that can be claimed as a tax deduction is limited to $2,500 as of the 2018 tax year. hence the statement is False

2. Divorce or separation agreements after 2018. Amounts paid as alimony or separate maintenance payments under a divorce or separation agreement executed, or changed, after 2018 won't be deductible by the payer. Such amounts also won't be includible in the income of the recipient. Hence if the agreement is executed in 2018, the periodic payaments are includible in income of the recipient. hence the statement is True

3. The money deposited into the Health Savings Account (HSA) is not subject to federal income tax at the time of the deposit is made. Additionally, HSA funds will accumulate year-to-year if the money is not spent. HSA funds may be used to pay for qualified medical expenses at any time. ... The interest earned on the account is tax-free. hence the statement is True

4. Over-the-counter aspirin or other pain reliever or Over-the-counter Cough medicine is a deductible expenses. Provided they are taken with prescription. hence the statement is True