This Year Riley Files Single and Reports Modified AGI of $71,000

question 7

Multiple Choice

This year Riley files single and reports modified AGI of $71,000. Riley paid $1,200 of interest on a qualified education loan. What amounts can Riley deduct for qualifying education interest?

• A)The deduction for qualifying education interest is $1,200.
• B)The deduction for qualifying education interest is $1,000.
• C)The deduction for qualifying education interest is $720.
• D)The deduction for qualifying education interest is $200.
• E)None of the abovE.Riley may deduct the amount paid ($1,200) up to $2,500, reduced by the phase-out amount.The phase-out amount is the amount paid up to $2,500 ($1,200 for Riley) multiplied by 40% [71,000 - 65,000]/15,000 = 40%.Hence, Riley may deduct $720 [$1,200 - [$1,200 × 40%] = $720].

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Definitions:

Participative Decision-Making

A decision-making process in which all members of a group contribute to and influence the outcome of a decision.

Coercion

Involves compelling an individual to act in a certain way by using force or threats.

Resistance To Change

Refers to opposition or pushback by individuals or groups within an organization when they perceive that a change is threatening their norms, beliefs, procedures, or interests.

Organizational Development

An area of study and application focused on enhancing people's understanding and capability in achieving better organizational change and performance outcomes.