Clarissa is a very successful real estate agent.She spends $5,000 per year taking her clients out to dinner upon completion of a sale.Unfortunately,Clarissa is not a good recordkeeper and does not maintain receipts.However,the entertainment is standard practice in her field,and trade journals indicate that $5,000 is a reasonable amount for a successful high-end agent.Before consideration of the 2% of AGI floor,Clarissa will be allowed to deduct $2,500.

Question

Quizplus · Accepted Answer

Clarissa can deduct 50% of her entertainment expenses, which would be $2,500, but without receipts, she may not be able to substantiate the deduction.

Clarissa Is a Very Successful Real Estate Agent