Your Friend Scotty Informs You That He Received a "Tax-Free

question 65

Multiple Choice

Your friend Scotty informs you that he received a "tax-free" reimbursement in 2010 of some medical expenses he paid in 2009.Which of the following statements best explains why Scotty is not required to report the reimbursement in gross income?

• A)Scotty itemized deductions in 2009.
• B)Scotty did not itemize deductions in 2009.
• C)Scotty itemized deductions in 2010.
• D)Scotty did not itemize deductions in 2010.
• E)Scotty itemized deductions in 2010 but not in 2009.

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Definitions:

William Pitt

A British statesman of the Whig group who led the government of Great Britain twice in the mid-18th century and is known for his leadership during the Seven Years' War.

French Defeat

An event or series of events resulting in the unsuccessful outcome of a conflict or war for France, leading to loss of territory, power, or prestige.

Quakers

A religious group officially known as the Religious Society of Friends, known for their pacifist beliefs, simple living, and emphasis on inner guidance.

French and Indian War

A conflict between Britain and France from 1754 to 1763 in North America, part of the larger Seven Years' War, involving various Native American tribes aligning with either side.