Wayne developed heart problems and was unable to climb the stairs to reach his second-floor bedroom.His physician advised him to add a first-floor bedroom to his home.The cost of constructing the room was $42,000.The increase in the value of the residence as a result of the room addition was determined to be $18,000.In addition,Wayne paid the contractor $7,500 to construct an entrance ramp to his home and $10,500 to widen the hallways to accommodate his wheelchair.Wayne's AGI for the year was $120,000.How much of these expenditures can Wayne deduct as a medical expense?

Question

Quizplus · Accepted Answer

The total cost of the medical expenses related to the home modifications is:

$42,000 (room addition) + $7,500 (entrance ramp) + $10,500 (widening hallways) = $60,000

Since Wayne's AGI is $120,000, he can only deduct medical expenses if they exceed 10% of his AGI.

10% of $120,000 = $12,000

Therefore, Wayne can only deduct medical expenses that exceed $12,000.

$60,000 - $18,000 (increase in home value) = $42,000

Since the room addition was for medical purposes, Wayne can deduct the full cost of $42,000 as a medical expense.

Total amount deductible = $42,000

So, the correct answer is (C) $33,000.

Wayne Developed Heart Problems and Was Unable to Climb the Stairs