During the current year holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows:
10 at $10 each
8 at $25 each
8 at $50 each
8 at $100 each
For the current year, what is the amount of Bob's business gift deduction?

Question

During the current year holiday season, Bob, a barber, gave business gifts to 34 customers. The values of the gifts, which were not of a promotional nature, were as follows: 
10 at $10 each
8 at $25 each
8 at $50 each
8 at $100 each
For the current year, what is the amount of Bob's business gift deduction?

Quizplus · Accepted Answer

The IRS allows a deduction of up to $25 per gift to an individual per year. Therefore, for the 10 gifts at $10 each, the full $100 is deductible. For the remaining 24 gifts (8 at $25 each, 8 at $50 each, and 8 at $100 each), only $25 per gift is deductible, totaling $600 ($25 x 24). Adding these amounts gives a total deduction of $700 ($100 + $600).

During the Current Year Holiday Season, Bob, a Barber, Gave