Brandon and Jane Forte File a Joint Tax Return and Decide

question 96

Multiple Choice

Brandon and Jane Forte file a joint tax return and decide to itemize their deductions. The Forte's income for the year consists of $120,000 in salary, $1,000 interest income, $1,500 nonqualifying dividends, and $1,000 long-term capital gains. The Forte's expenses for the year consist of $3,000 investment interest expense and $900 tax preparation fees. Assuming that the Forte's marginal tax rate is 30%, what is the amount of investment interest expense deduction for the year?

• A) Zero; investment interest expense is below two percent of AGI.
• B) $1,000
• C) $2,500
• D) $3,000
• E) None of these

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Definitions:

Formal Rules

Explicitly stated policies or statutory regulations that govern behavior and procedures within organizations or institutions.

Fundamentals Of Organizing

involves the basic principles and practices of arranging the structure, roles, and processes in an organization to achieve efficiency and goals.

Span Of Control

The number of subordinates or direct reports that a manager or leader can effectively oversee and manage.

Chain Of Command

The hierarchical structure within an organization that outlines the authority and responsibility relationships from the highest to the lowest ranks.