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For Many Years Andy Paid Someone Else to File His

Question 61

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For many years Andy paid someone else to file his income tax return. After taking a personal finance course at his local college, Andy feels he is ready to tackle it on his own for tax year 2012. Andy is single with an income of $35,000 and has no dependents. He has little interest income from savings, does not have a personal IRA, and plans to itemize deductions. Andy owns a home and travels a lot with his job. He pays some of his own work-related expenses because his employer does not pay for all of them. His only personal investments include 1,000 shares of stock he inherited from his uncle, which he does not intend to sell for many years because the blue-chip company has a strong history of dividend income and share price appreciation. However, he does contribute monthly to his 401(k) plan at work.
-To help Andy with his tax planning, he should carefully track and maintain records for all of the following expenses during the tax year except ________.


A) all expenses for prescribed health care needs that are not covered by insurance
B) all job related expenses, especially those that are and are not reimbursed by his employer
C) state and local income taxes, real estate taxes, and personal property taxes
D) price appreciation, or increases from January 1 to December 31, for the 1000 shares of stock he owns
E) all of the above

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