A Review of the 2016 Tax File of Gregory, a Single

question 37

Multiple Choice

A review of the 2016 tax file of Gregory, a single taxpayer who is age 40, provides the following information regarding Gregory's 2016 tax status: $$\begin{array} { | l | r | } \hline \text { Adjusted gross income } & \$ 40,000 \\\hline \text { Medical expenses (before percentage limit) } & 5,000 \\\hline \text { Itemized deductions other than medical } & 5,500 \\\hline 2016 \text { potential standard deduction } & 6,300 \\\hline\end{array}$$ In 2017, Gregory receives a reimbursement for last year's medical expenses of $1,200. As a result, Gregory must

• A) include $200 in gross income for 2017.
• B) include $1,200 in gross income for 2017.
• C) reduce 2017's medical expenses by $1,200.
• D) amend the 2016 return.

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Definitions:

Customized Interactions

Personalized exchanges between a business and its customers, tailored to meet the individual needs or preferences of the customer.

Repeat Purchases

The act of buying a product or service more than once, indicating customer satisfaction and loyalty.

Media Cooperation

The collaboration between media organizations and other entities for mutual benefit.

Absolute Costs

refer to the fixed, variable, direct, and indirect costs incurred by a business in the production of goods or services.