4. Classify of the following expenditures as a deduction for AGI, a deduction from AGI or not deductible:

4. Classify of the following expenditures as a deduction for AGI, a deduction from AGI or not deductible: a. Amos contributes to his H.R. 10 plan (i.e., a retirement plan for a self-employed individual). b. Keith pays child to his former wife, Renee, for the support of their son, Chris. c. Judy pays professional dues that are reimbursed by her employer. d. Ted pays $500 as the monthly mortgage payment on his personal residence. Of this amount, $100 represents a payment on principle, and $400 represents an interest payment. e. Lynn pays a moving company for moving her household goods to Detroit, where she is starting a new job. She is not reimbursed by her employer. f. Ralph pays property taxes on his personal residence. 5. Larry and Susan each invest $10,000 in separate investment activities. They each incur deductible expenses of $800 associated with their respective investments. Explain why Larry’s expenses might be properly classified as deductions from AGI (itemized deductions) and Susan’s expenses might be appropriately classified as deductions for AGI. 10. What is the “actually paid” requirement for the deduction of an expense by a cash basis taxpayer? Does actual payment ensure a deduction? Explain. 1. Dan, a self-employed individual taxpayer, prepared his own income tax return for the past year and has asked you to check it for accuracy. Your review indicated that Dan failed to claim certain business entertainment expenses. a. Will the correction of this omission affect the amount of medical expenses Dan can deduct? Explain. b. Would it matter if Dan were employed rather than self-employed? Explain. 3. Jerry and Ernie are comparing their tax situations. Both are paying all of the nursing home expenses of their parents. Jerry can include the expense in computing his medical expense deduction, but Ernie cannot. What explanation can you offer for the difference? 4. Cheryl incurred $8,700 of medical expenses in November 2015. On December 5, the clinic where she was treated mailed her the insurance claim for it had prepared for her with a suggestion that she sign and return the form immediately to receive her reimbursement from the insurance company by December 31. What tax issuers should Cheryl consider in deciding whether to sign and return the form in December 2015 or January 2016? 24. Emma Doyle, age 55, is employed as a corporate attorney. For calendar year 2015, she had AGI of $100,000 and paid the following medical expenses: Medical insurance premiums $3,700 Doctor and dentist bills for Bob and April (Emma’s parents) $6,800 Doctor and dentist bills for Emma $5,200 Prescription medicines for Emma $ 400 Nonprescription insulin for Emma $ 350