Question : 81. April and Wilson married and file a joint tax return. : 1313549

81. April and Wilson are married and file a joint tax return. Wilson is a police officer, and in the current tax year he spends $375 on uniforms and $150 for dry cleaning the uniforms. April is in the National Guard and military regulations restrict her from wearing her uniforms when she is off duty. The cost of uniforms for the year was $225 and the cost of dry cleaning them amounted to $75. April was granted a uniform allowance of $200 for the year. She also purchased a pair of standard black shoes to wear while on duty that cost $45. How much may they deduct on Schedule A for special clothing and uniforms, before considering the 2 percent of adjusted gross income limitation?

a. $525

b. $625

c. $670

d. $825

e. None of the above

82. Which of the following employees may deduct the cost of a uniform?

a. A stock broker required by her employer to wear a business suit

b. A construction worker required by her employer to wear blue jeans

c. A washer repair woman who must wear overalls while on the job

d. A police officer who must wear a uniform while on duty

e. A delivery person who must wear khaki-colored clothes on the job

83. Mary Lou took an $8,000 distribution from her educational savings account and used $6,500 to pay for qualified higher education expenses. The remaining balance of $1,500 was used to purchase clothes. On the date of the distribution, her educational savings account had a $28,000 balance including the $21,000 she had contributed. How much of the $8,000 distribution is tax-free?

a. $0

b. $1,500

c. $6,500

d. $7,625

e. $8,000

84. Charlie is a single taxpayer with income of $106,000 which includes $22,500 of interest income. Contributions to educational savings accounts are phased out between $95,000 and $110,000. What is the maximum contribution Charlie can make to an educational savings account?

a. $2,500

b. $2,000

c. $1,467

d. $533

e. $0

85. Which of the following is correct for Qualified Tuition Programs for 2014?

a. Contributions are deductible and qualified educational expense distributions are tax-free.

b. Contributions are not deductible and qualified educational expense distributions are tax-free.

c. Contributions are deductible and qualified educational expense distributions are taxable.

d. Contributions are not deductible and qualified educational expense distributions are taxable.

86. In 2014, Jennie receives $12,000 (of which $3,000 is earnings) from a Qualified Tuition Program. She uses the funds to pay for new furniture for her apartment. What amount is taxable to Jennie?

a. $12,000

b. $9,000

c. $3,000

d. $0

87. Which of the following is true with respect to an education incentive?

a. Contributions to Qualified Tuition Programs (Section 529 plans) are deductible.

b. Contributions to education savings accounts (Coverdell ESAs) are deductible.

c. Tuition paid by a taxpayer earning $300,000 of income is deductible.

d. Married taxpayers at any income level may contribute to a Qualified Tuition Program (Section 529 plan).

88. For married taxpayers filing a joint return in 2014, at what AGI level does the phase-out limit for contributions to Qualified Tuition Programs (Section 529 plans) start?

a. $150,500

b. $188,150

c. $225,750

d. There is no phase-out limit on Qualified Tuition Program contributions.

89. Pat has a dependent daughter and files as head of household. She has AGI of $375,000. What percentage of the $3,950 personal exemption and $3,950 dependency exemption may she deduct on her 2014 income tax return?

a. 0 percent

b. 22 percent

c. 78 percent

d. 100 percent

90. Alicia is a single taxpayer with AGI of $350,000 and itemized deductions of $100,000 which are made up of $30,000 of mortgage interest, $30,000 of state income taxes and property taxes, and $40,000 of contributions to her temple. What is the amount of itemized deductions that Alicia may deduct on her 2014 income tax return after the phase-out for high-income taxpayers?

a. $100,000

b. $97,126

c. $70,000

d. $2,874