During the current year, Hugh, a self-employed individual, paid the following amounts:
Real estate tax on Iowa residence $3,800
State income tax 1,700
Real estate taxes on land in Puerto Rico (held as an investment) 1,100
Gift tax paid on gift to daughter 1,200
State sales taxes 1,750
State occupational license fee 300
Property tax on value of his automobile (used 100% for business) 475
What is the maximum amount Hugh can claim as taxes in itemizing deductions from AGI?
e) None of the above.
And why...© BrainMass Inc. brainmass.com June 3, 2020, 9:22 pm ad1c9bdddf
For Schedule A and itemizing taxes, following are the rules:
1. Real estate taxes of $3800 are fully deductible
2. State income tax of ...
The solution explains which of the list of taxes are actually deductible as Schedule A - taxes. An explanation is included for items which are not part of the deductible amount.