Austin, a Single Individual with a Salary of $100,000, Incurred

question 119

Essay

Austin, a single individual with a salary of $100,000, incurred and paid the following expenses during 2019: $$\begin{array} { l r } \text { Medical expenses } & \$ 5,000 \\\text { Alimony (divorce finalized in 2019) } & 24,000 \\\text { Charitable contributions } & 2,000 \\\text { Casualty loss (after } \$ 100 \text { floor) } & 1,000 \\\text { Mortgage interest on personal residence } & 4,500 \\\text { Property taxes on personal residence } & 4,200 \\\text { Moving expenses } & 2,500 \\\text { Contribution to a traditional IRA } & 4,000 \\\text { Sales taxes (no state or local income tax is imposed) } & 1,300\end{array}$$ Calculate Austin's deductions for AGI.

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Definitions:

Debtor

A party that has a financial obligation or debt to another party, referred to as the creditor, within a commercial transaction.

Automatic Stay

A legal provision that halts proceedings and lawsuits against a debtor immediately upon the filing of a bankruptcy petition.

Chapter 7

A provision of the United States Bankruptcy Code dealing with asset liquidation for the debtor to pay off creditors.

Chapter 11

A provision of the United States Bankruptcy Code that allows businesses to reorganize and restructure their debts in order to remain operational.