Indicate the Proper Treatment in the Current Year for the Underlined

question 142

Multiple Choice

Indicate the proper treatment in the current year for the underlined amounts. Treat each item as an independent event. Indicate whether the amount is deductible or not; if deductible whether it is deductible FOR or FROM AGI; and indicate the amount of the deduction for the current year considering any relevant limitations. Assume the taxpayer has deductions greater than the standard deduction, has AGI of $69,000 without regard to the following transactions and has no "total" income limitations related to itemized deductions.
-Federal quarterly estimate of $3,000 paid by a self-employed taxpayer.

• A)Not Deductible
• B)Deductible - For AGI
• C)Deductible - From AGI

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Definitions:

7 ± 2

A theory suggesting that the average person can hold about 7 (plus or minus 2) items in their working memory.

Miller

Refers to George A. Miller, a cognitive psychologist best known for his theory regarding the limit of short-term memory capacity, often summarized as "seven, plus or minus two" pieces of information.

Memory Capacity

Memory capacity refers to the amount of information that can be stored in the memory system at any given time.

Sensory Register

The component of memory that holds incoming sensory information for a very short period of time, almost like a snapshot.