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

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Question 31

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Allowing for the cutback adjustment (50% reduction for meals and entertainment) ,which of the following trips,if any,will qualify for the travel expense deduction?

A) Dr. Jones, a general dentist, attends a two-day seminar on developing a dental practice.
B) Dr. Brown, a surgeon, attends a two-day seminar on financial planning.
C) Paul, a romance language high school teacher, spends summer break in France, Portugal, and Spain improving his language skills.
D) Myrna went on a two-week vacation in Boston. While there, she visited her employer's home office to have lunch with former co-workers.
E) None of the above.

F) B) and E)
G) C) and E)

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Question 32

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Christopher just purchased an automobile for $40,000 which he plans to claim 100% as being for business use.In order to take advantage of MACRS and § 179,he plans to use the actual cost method for determining his deduction in the first year.In subsequent years,he will switch to the automatic mileage method.Comment on Christopher's proposed approach.

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First,limitations are imposed on how muc...

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Question 33

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An individual,age 40,who is not subject to the phase-out provision may contribute a deductible amount to a Roth IRA up to $5,000 per year in 2011.

Match the statements that relate to each other.(Note: Choice L may be used more than once.)

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

Bob lives and works in Newark,NJ.He travels to London for a three-day business meeting,after which he spends three days touring Scotland.All of his air fare is deductible.

By itself,credit card receipts will not constitute adequate substantiation for travel expenses.

Nicole moved from California to Dallas to accept a better job.She incurred the following unreimbursed moving expenses: What is Nicole's moving expense deduction?

Michael is the city sales manager for "Chick-Stick," a national fast food franchise.Every working day,Michael drives his car as follows: Michael's deductible mileage is:

Susan is a self-employed accountant with a qualified defined contribution plan (a Keogh plan) .She has the following income items for the year: What is the maximum amount Susan can deduct as a contribution to her retirement plan in 2011,assuming the self-employment tax rate is 15.3%?

Ashley and Matthew are husband and wife and both are practicing CPAs.On a joint return,Ashley gets to deduct her professional dues but Matthew does not.Explain.

There is no cutback adjustment for meals and entertainment as to employees who are subject to regulation by the U.S.Department of Transportation.

If a married taxpayer is an active participant in another qualified retirement plan,the traditional IRA deduction phaseout begins at $90,000 of AGI for a joint return in 2011.

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

When is a taxpayer's work assignment in a new locale temporary? Permanent? What difference does it make?

Faith just graduated from college and she needs advice on the tax treatment of the costs she incurs in connection with her first job (a loan officer at a bank).Specifically,she wants to know about the following items:

A taxpayer has multiple jobs at different locations.What factors are considered in determining the site of his tax home?

The § 222 deduction for tuition and related expenses is available:

Distributions from a Roth IRA that are subject to taxation are treated first as from earnings and last as from contributions.

A direct transfer of funds from a qualified retirement plan to an IRA is not subject to the withholding rules.