Eileen Is a Single Individual with No Dependents 1Charitable Contributions

question 25

Essay

Eileen is a single individual with no dependents.Her adjusted gross income for 2013 is $60,000.She has the following items that qualify as itemized deductions.What is the amount of Eileen's AMT adjustment for itemized deductions for 2013?
$$\begin{array} { l r } \text { Medical expenses (before limitations) } & \$ 12,000 \\\text { Mortgage interest on a qualified residence } & 8,000 \\\text { Charitable contribution of a Rockwell portrait } & \\( \$ 12,000 \mathrm {~ FMV } ; \$ 10,000 \text { basis) } & 12,000 \\\text { State income taxes paid and withheld } & 3,000 \\\text { Real estate taxes paid } &1,500 \\\text { Unreimbursed employee expenses (before limitation) } & 2,400 \\\text { Income tax return preparation fee (before limitation) } & 400\end{array}$$
1.Charitable contributions.
2.Casualty and theft losses.
3.Qualified housing interest.
4.Investment interest.
5.Miscellaneous itemized deductions,not subject to 2% of AGI."6.Unreimbursed medical expenses in excess of 10% (not 7.5%)of AGI.Accordingly,Eileen must add back $1,500 of her medical expense deduction,$3,000 of her state income taxes,$1,500 of her real estate taxes,and the deductible portion of her miscellaneous itemized deductions ($1,600)to her taxable income.Because only $1,600 of the expenses are deductible,that amount and not the entire $2,400 is added back to taxable income.
$\begin{array}{ll}\text { Medical expense adjustment: }\\\text { Regular tax deduction } & \$ 12,000-(7.5 \% \times \$ 60,000 \mathrm{AGI})=\$ 7,500\\\text { less } &\$ 12,000-(10 \% \times \$ 60,000 \mathrm{AGI})=6,000&\$1,500\end{array}$
Unreimbursed employee expenses + tax prep fee:
$\begin{array}{lr}\$ 2,800(\$ 2,400+400)-[2 \% \times \$ 60,000 \mathrm{AGI}] &1,600 \\ \text {State income taxes} &3,000 \\ \text {Real estate taxes } &\underline{1,500 }\\ \text { Total } &\underline{\$ 7,600} \\\end{array}$ "

---

Definitions:

Aging Population

Refers to a demographic trend characterized by an increase in the proportion of older individuals within a society.

Proportion of Minorities

The ratio or percentage of individuals in a population who identify with or belong to ethnic, racial, or other minority groups.

Injury-Related Death Rates

Statistical measures representing the number of deaths caused by injuries in a specific population within a given time frame.

Rural Populations

Communities located in non-urban areas characterized by fewer residents, often facing unique healthcare delivery and accessibility challenges.