1. Which expense, incurred and paid in 2015, can be claimed as a miscellaneous itemized deduction subject to the 2% of AGI floor?
a. Self-employed health insurance.
b. Unreimbursed moving expenses.
c. Employee’s unreimbursed business car expense.
d. Self-employment taxes.
2. Raquel, who works in medical sales, drives her own vehicle to various locations for client sales meetings. Her employer reimburses her $400 each month for various business expenses and does not expect Raquel to provide proof of her expenses. Her employer included this $4,800 reimbursement in Raquel’s 2015 W-2 as part of her wages. In 2015, Raquel incurred $3,000 in transportation expense, $1,000 in parking and tolls expense, $1,800 in car repair expense, and $600 for expenses while attending a professional association convention. Assume that Raquel uses the vehicle for business purposes only and that she maintains adequate documentation to support all of these expenditures. What amount is Raquel entitled to deduct on her Schedule A for miscellaneous itemized deductions?
a. $6,400 of expenses subject to the 2% of AGI limitation.
b. $4,800 because her employer follows a non-accountable plan.
c. $1,600, the difference between her expenditures and her reimbursement.
d. $0 because her employer follows a non accountable plan.
3. In 2015, high income individuals are required to forfeit part of their itemized deductions. This effectively:
a. Reduces their overall tax rate.
b. Does not affect their overall tax rate.
c. Increases their overall tax rate.
d. None of the above.
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