The crucial reason for determining whether an item is deductible as an expense under § 162 or under § 212 is that
A)Production-of-income expenses are not deductible.
B)§ 162 business expenses usually are deductions for A.G.I., while § 212 production-of-income expenses usually are miscellaneous itemized deductions.
C)§ 162 business expenses are deductions from A.G.I., while § 212 production-of-income expenses are deductions for A.G.I.
D)It resolves certain ownership questions.

Question

Quizplus · Accepted Answer

The reason for determining whether an item is deductible as an expense under § 162 or under § 212 is that § 162 business expenses usually are deductions for A.G.I., while § 212 production-of-income expenses usually are miscellaneous itemized deductions. It is important to know this because the deduction limits and requirements are different for these two types of expenses.

The Crucial Reason for Determining Whether an Item Is Deductible