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11. The Adams family had $10,542 worth of volcano damage that was not covered by insurance. They need to follow IRS procedures to take a casualty deduction on Schedule A. a. The IRS requires that $200 be deducted from each casualty. What is the total casualty loss after the $200 is deducted? b. Their adjusted gross income is $80,608. Find 15% of their adjusted gross income. c. Their Schedule A casualty deduction can be found by subtracting 15% of the adjusted gross income from the answer to part a. What is their casualty loss deduction?

11. The Adams family had $10,542 worth of volcano damage that was not covered by insurance. They need to follow IRS procedures to take a casualty deduction on Schedule A. a. The IRS requires that $200 be deducted from each casualty. What is the total casualty loss after the $200 is deducted? b. Their adjusted gross income is $80,608. Find 15% of their adjusted gross income. c. Their Schedule A casualty deduction can be found by subtracting 15% of the adjusted gross income from the answer to part a. What is their casualty loss deduction?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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SCHEDULES A&B (Form 1040) Department of the Treasury Internal Revenue Service Namets) shown on Form Medical and Dental Expenses Taxes You Paid (See page A-2.) Interest You Paid (See page A-5.) Note. Personal interest is not deductible. Gifts to Charity If you made a gift and got a benefit for it. see page A-7. (See page A-9) Other Miscellaneous Deductions Total Itemized Deductions Q1 S 9 10 11 Job Expenses 21 and Certain Miscellaneous Deductions 22 Casualty and Theft Losses 20 1 2 Enter amount from Form 1040, line 38 3 Multiply line 2 by 7.5% (075) 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- 5 State and local (check only one box): 15 16 (99) 1040 a b 6 Real estate taxes (see page A-5) 7 Personal property taxes 8 Other taxes. List type and amount 17 Attach to Form 1040, Schedule A-Itemized Deductions (Schedule B is on back) ► See Instructions for Schedules A&B (Form 1040). Caution. Do not include expenses reimbursed or paid by others. Medical and dental expenses (see page A-1) L2117017-1 Income taxes, or General sales taxes Financial Math 2 Binder .... Add lines 5 through 8 12 Points not reported to you on Form 1098. See page A-6) for special rules . 13 Qualified mortgage insurance premiums (see page A-6) 14 Investment interest. Attach Form 4952 if required. (See page A-6.) Add lines 10 through 14 Gifts by cash or check. If you made any gift of $250 or more, see page A-7 . Other than by cash or check. If any gift of $250 or more, see page A-8. You must attach Form 8283 if over $500 18 Carryover from prior year 19 Add lines 16 through 18 ....... Casualty or theft loss(es). Attach Form 4684. (See page A-8.) Unreimbursed employee expenses-job travel, union dues, job education, etc. Attach Form 2106 or 2106-EZ if required. (See page A-9.) Tax preparation fees 23 Other expenses-investment, safe deposit box, etc. List type and amount ******* Home mortgage interest and points reported to you on Form 109810 2016 Home mortgage interest not reported to you on Form 1098. If paid to the person from whom you bought the home, see page A-6 and show that person's name, identifying no. and address Add lines 21 through 23 Enter amount from Form 1040, line 38 25 For Paperwork Reduction Act Notice, see Farm 1040 instructions. 1 3160 00 + . 5 6 7 8 11 12 13 14 16 24 25 26 Multiply line 25 by 2% (02) 26 27 Subtract line 26 from line 24. If line 26 is more than line 24, enter -0- Other-from list on page A-10. List type and amount 28 17 18 21 11290 22 23 24 4245 164 29 Is Form 1040, line 38, over $159,950 (over $79,975 if married filing separately)? No. Your deduction is not limited. Add the amounts in the far right column for lines 4 through 28. Also, enter this amount on Form 1040, line 40. Yes. Your deduction may be limited. See page A-10 for the amount to enter. 30 If you elect to itemize deductions even though they are less than your standard deduction, check here Cat. No. 11330X Attachment Sequence No. 07 Your social security number 4 OMB No. 1545-0074 9 15 2096 19 20 1429 27 28 29 00 5562 60 Schedule A (Farm 1040) 2008 43
Transcribed Image Text:SCHEDULES A&B (Form 1040) Department of the Treasury Internal Revenue Service Namets) shown on Form Medical and Dental Expenses Taxes You Paid (See page A-2.) Interest You Paid (See page A-5.) Note. Personal interest is not deductible. Gifts to Charity If you made a gift and got a benefit for it. see page A-7. (See page A-9) Other Miscellaneous Deductions Total Itemized Deductions Q1 S 9 10 11 Job Expenses 21 and Certain Miscellaneous Deductions 22 Casualty and Theft Losses 20 1 2 Enter amount from Form 1040, line 38 3 Multiply line 2 by 7.5% (075) 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- 5 State and local (check only one box): 15 16 (99) 1040 a b 6 Real estate taxes (see page A-5) 7 Personal property taxes 8 Other taxes. List type and amount 17 Attach to Form 1040, Schedule A-Itemized Deductions (Schedule B is on back) ► See Instructions for Schedules A&B (Form 1040). Caution. Do not include expenses reimbursed or paid by others. Medical and dental expenses (see page A-1) L2117017-1 Income taxes, or General sales taxes Financial Math 2 Binder .... Add lines 5 through 8 12 Points not reported to you on Form 1098. See page A-6) for special rules . 13 Qualified mortgage insurance premiums (see page A-6) 14 Investment interest. Attach Form 4952 if required. (See page A-6.) Add lines 10 through 14 Gifts by cash or check. If you made any gift of $250 or more, see page A-7 . Other than by cash or check. If any gift of $250 or more, see page A-8. You must attach Form 8283 if over $500 18 Carryover from prior year 19 Add lines 16 through 18 ....... Casualty or theft loss(es). Attach Form 4684. (See page A-8.) Unreimbursed employee expenses-job travel, union dues, job education, etc. Attach Form 2106 or 2106-EZ if required. (See page A-9.) Tax preparation fees 23 Other expenses-investment, safe deposit box, etc. List type and amount ******* Home mortgage interest and points reported to you on Form 109810 2016 Home mortgage interest not reported to you on Form 1098. If paid to the person from whom you bought the home, see page A-6 and show that person's name, identifying no. and address Add lines 21 through 23 Enter amount from Form 1040, line 38 25 For Paperwork Reduction Act Notice, see Farm 1040 instructions. 1 3160 00 + . 5 6 7 8 11 12 13 14 16 24 25 26 Multiply line 25 by 2% (02) 26 27 Subtract line 26 from line 24. If line 26 is more than line 24, enter -0- Other-from list on page A-10. List type and amount 28 17 18 21 11290 22 23 24 4245 164 29 Is Form 1040, line 38, over $159,950 (over $79,975 if married filing separately)? No. Your deduction is not limited. Add the amounts in the far right column for lines 4 through 28. Also, enter this amount on Form 1040, line 40. Yes. Your deduction may be limited. See page A-10 for the amount to enter. 30 If you elect to itemize deductions even though they are less than your standard deduction, check here Cat. No. 11330X Attachment Sequence No. 07 Your social security number 4 OMB No. 1545-0074 9 15 2096 19 20 1429 27 28 29 00 5562 60 Schedule A (Farm 1040) 2008 43
11. The Adams family had $10,542 worth of volcano damage that was not covered by insurance. They need to follow IRS procedures to take a casualty deduction on Schedule A. a. The IRS requires that $200 be deducted from each casualty. What is the total casualty loss after the $200 is deducted? b. Their adjusted gross income is $80,608. Find 15% of their adjusted gross income. c. Their Schedule A casualty deduction can be found by subtracting 15% of the adjusted gross income from the answer to part a. What is their casualty loss deduction?
Transcribed Image Text:11. The Adams family had $10,542 worth of volcano damage that was not covered by insurance. They need to follow IRS procedures to take a casualty deduction on Schedule A. a. The IRS requires that $200 be deducted from each casualty. What is the total casualty loss after the $200 is deducted? b. Their adjusted gross income is $80,608. Find 15% of their adjusted gross income. c. Their Schedule A casualty deduction can be found by subtracting 15% of the adjusted gross income from the answer to part a. What is their casualty loss deduction?
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