Collin and Christine Are Married and File Joint

question 103

Essay

Collin and Christine are married and file joint.Their dependent son,Trevor,is a full-time college student at a qualified educational institution.This year Collin and Christine borrowed $30,000 to pay for Trevor's tuition ($22,000)and room and board ($8,000).At year end Collin paid $3,200 in interest on the loan.What amounts can Collin and Christine deduct for interest and education expenses if they estimate that their AGI will be $138,000 absent any deductions for AGI? Assume the 2016 rules apply for purposes of the qualified education expense deduction.

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Definitions:

AASB 12/IFRS 12

Refers to the disclosure of interests in other entities, providing requirements on the disclosure of interests in subsidiaries, joint arrangements, associates, and unconsolidated structured entities.

Unrecognised Share of Losses

Losses attributable to an investor’s share in an investee that are not reflected in the investor’s financial statements because they exceed the investor's interest in the investee’s equity.

Discontinued Use

Refers to the cessation of operations or production of a segment or unit within a business.

Equity Method

An accounting technique used to record an investor’s proportional share of an associate company’s earnings or losses on its financial statements.