Doug and Sue Click File a Joint Tax Return and Decide

question 3

Multiple Choice

Doug and Sue Click file a joint tax return and decide to itemize their deductions. The Click's income for the year consists of $90,000 in salary, $2,000 interest income, $800 long-term capital loss. The Click's expenses for the year consist of $1,500 investment interest expense. Assuming that the Click's marginal tax rate is 35 percent, what is the amount of their investment interest expense deduction for the year?

• A) $1,200.
• B) $1,500.
• C) $2,000.
• D) $2,300.
• E) None of the choices are correct.

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Definitions:

Connective

In logic and mathematics, a symbol or word used to connect statements or propositions, such as "and", "or", "if...then".

Restrictive

Imposing limitations or conditions on something's scope, use, or extent.

Nonrestrictive

Describing a clause or phrase that provides additional information without limiting the meaning of the sentence.

Nonrestrictive Clause

A type of clause in a sentence that provides additional information but does not limit or restrict the meaning of the main clause.