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

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Question 71

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At age 65, Camilla retires from her job in Boston and moves to Florida.As a retiree, she is not subject to the time test in deducting her moving expenses.

A) True
B) False

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Question 72

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

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$11,500 ($4,000 + $500 + $7,00...

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Question 73

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In terms of income tax treatment, what is the difference between common law and statutory employees?

Kelly, an unemployed architect, moves from Boston to Phoenix to accept a job as a chef at a restaurant.Kelly's moving expenses are not deductible because her new job is in a different trade or business.

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

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

Tired of her 60 mile daily commute, Margaret purchases a condo that is only five miles from her job.Margaret's moving expenses to her new condo are allowed and can be claimed by her as a deduction.

In terms of IRS attitude, what do the following expenses have in common?

For the spousal IRA provision to apply, a joint return must be filed.

Madison is an instructor of fine arts at a local community college.If she spends $600 (not reimbursed) on art supplies for her classes, $250 of this amount can be claimed as a deduction for AGI.

A taxpayer who claims the standard deduction will not avoid the 2% floor on unreimbursed employee expenses.

A taxpayer who lives and works in Tulsa travels to Buffalo for five days.If three days are spent on business and two days are spent on visiting relatives, only 60% of the airfare is deductible.

A worker may prefer to be classified as an employee (rather than an independent contractor) for which of the following reasons:

Ramon and Ingrid work in the field of public relations and incur sizable entertainment expenses.Ramon is employed by a consumer products company, while Ingrid is a self-employed consultant.Regarding the tax treatment of the entertainment expenses, when would:

Alexis (a CPA and JD) sold her public accounting practice in Des Moines and accepted a job with the Seattle office of a national accounting firm.Her moving expenses are not deductible because she has changed employment status (i.e., went from self-employed to employee).

The Federal per diem rates that can be used for "deemed substantiated" purposes are not the same for all locations in the country.

If a taxpayer does not own a home but rents an apartment, the office in the home deduction is not available.

Samuel, age 53, has a traditional deductible IRA with an account balance of $112,000.Of this amount, $82,000 represents contributions and $30,000 represents earnings.In 2012, he converts his traditional IRA into a Roth IRA.What amount must Samuel include in his gross income, if any, in 2012?

Rod uses his automobile for both business and personal use and claims the automatic mileage rate for all purposes.During 2012, his mileage was as follows: How much can Rod claim for mileage?

Due to a merger, Allison transfers from Miami to Chicago.Under a new job description, she is reclassified from employee to independent contractor status.Her moving expenses, which are not reimbursed, are as follows: Allison's deductible moving expense is: