Exam 9: Deductions: Employee and Self-Employed-Related Expenses

During the year,John went from Milwaukee to Alaska on business.Preceding a five-day business meeting,he spent four days vacationing at the beach.Excluding the vacation costs,his expenses for the trip are: ​ Presuming no reimbursement,deductible expenses are:

Match the statements that relate to each other. (Note: Choice L may be used more than once.) a.Cover charge paid to entertain client at a night club. b.Deductible even if taxpayer does not take the new job c.Company picnic sponsored by employer d.Use of Federal per diem allowance to substantiate meals while in travel status e.Does not have to be job related f.Can include cost of car insurance and automobile club dues g.Distribution from plan is taxable h.Distribution from plan is not taxable i.Expatriate (U.S. person who is employed overseas) returns home to retire j.Taxpayer moves to a new residence 55 miles closer to his present job k.Country club membership fee l.Correct match not provided -Keogh (H.R.10) plans

The IRS will issue advanced rulings as to whether a worker's status is that of an employee or an independent contractor.

Brian makes gifts as follows: ​ * Includes $2 for gift wrapping ​ Presuming adequate substantiation and no reimbursement,how much may Brian deduct?

Dave is the regional manager for a national chain of auto-parts stores and is based in Salt Lake City.When the company opens new stores in Boise,Dave is given the task of supervising their initial operation.For three months,he works weekdays in Boise and returns home on weekends.He spends $350 returning to Salt Lake City but would have spent $410 had he stayed in Boise for the weekend.As to the weekend trips,how much,if any,qualifies as a deduction?

In terms of IRS attitude,what do the following expenses have in common? a.Cost of a CPA exam review course. b.Cost of a review course for the bar exam. c.Cost of a law degree by a taxpayer who does not intend to practice law.

One of the tax advantages of being self-employed (rather than being an employee) is:

Eileen lives and works in Mobile.She travels to Rome for an eight-day business meeting,after which she spends two days touring Italy.All of Eileen's airfare is deductible.

A taxpayer who lives and works in Kansas City is sent to Chicago on an eight-day business trip.While in Chicago,taxpayer uses the hotel valet service to have some laundry done.The valet charge is a nondeductible personal travel expense.

Discuss the 2%-of-AGI floor and the 50% cutback limitation in connection with various employee expenses under the following arrangements: a.The employee is not reimbursed by the employer. b.The employee is fully reimbursed under a nonaccountable plan. c.The employee is partially reimbursed under an accountable plan. d.The employee is fully reimbursed under an accountable plan.

Which,if any,of the following is subject to a cutback adjustment?

Both traditional and Roth IRAs possess the advantage of tax-free accumulation of income within the plan.

Which of the following expenses,if any,qualify as deductible?

Sue performs services for Lynn. Regarding this arrangement, use the legend provided to classify each statement. a.Indicates employee status. b.Indicates independent contractor status. -Sue does not work for other parties.

In which,if any,of the following situations is the automatic mileage available?

In May 2017,after 11 months on a new job,Ken is fired after he assaults a customer.Ken must include in his gross income for 2017 any deduction for moving expenses he may have claimed on his 2016 tax return.

Tired of renting,Dr.Smith buys the academic robes she will wear at her college's graduation procession.The cost of this attire does not qualify as a uniform expense.

Under the regular (actual expense) method,the portion of the office in the home deduction that exceeds the income from the business can be carried over to future years.

Sick of her 65 mile daily commute,Edna purchases a condo that is only four miles from her job.Edna's moving expenses to her new condo are not allowed and cannot be claimed by her as a deduction.

In terms of meeting the distance test for purposes of deducting moving expenses,which of the following statements is correct?