Doug and Sue Click File a Joint Tax Return and Decide

question 36

Multiple Choice

Doug and Sue Click file a joint tax return and decide to itemize their deductions. The Clicks' income for the year consists of $90,600 in salary, $2,300 interest income,and $860 long-term capital loss. The Clicks' expenses for the year consist of $1,200 investment interest expense. Assuming that the Clicks' marginal tax rate is 35 percent, what is the amount of their investment interest expense deduction for the year?

• A)$1,440.
• B)$1,200.
• C)$2,300.
• D)$2,060.
• E)None of the choices are correct.

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Definitions:

Moral Turpitude

Conduct that is considered contrary to community standards of justice, honesty, or good morals.

Loathsome Disease

Historically referred to communicable diseases considered dangerous and highly contagious, often requiring quarantine; now less commonly used terminology.

Trespass to Personal Property

An intentional interference with someone's personal property without the owner's consent.

Conversion

An unauthorized act that deprives an owner of personal property without their consent.