Ms Kerry, Who Itemized Deductions on Schedule A, Paid $15,000

question 67

Multiple Choice

Ms. Kerry, who itemized deductions on Schedule A, paid $15,000 interest on funds borrowed to acquire taxable bonds. She also paid $660 of management fees that were fully deductible on Schedule A. Her AGI is $100,000, which includes $19,700 of interest income. How much of the interest expense can she deduct?

• A) $0
• B) $19,039
• C) $19,699
• D) $15,001

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Definitions:

Treasury Stock

Shares repurchased by the issuing company, reducing the amount of outstanding stock on the open market.

Shares Outstanding

The total number of shares of stock that are owned by investors, including both public shareholders and company insiders.

Market Price

The existing rate at which a service or asset is traded within a marketplace.

Buy Back

A corporate action in which a company purchases its own shares from the marketplace, reducing the number of outstanding shares.