Bill would like some tax benefits for his investment expenses incurred this year.His AGI is $190,000.Currently,his expenses consist of: (1)$1,000 investment advice fees,(2)$1,500 unreimbursed employee business expenses (a miscellaneous itemized deduction),and (3)$600 tax return preparation fees.How much more,if any,must Bill spend for investment expenses this year before he receives any tax benefit?

Question

Quizplus · Accepted Answer

Bill's miscellaneous itemized deductions are subject to a 2% AGI floor. His AGI is $190,000, so 2% of that is $3,800. His current expenses total $3,100 ($1,000 + $1,500 + $600), so he needs to spend more than $700 to exceed the $3,800 threshold and receive a tax benefit.

Bill Would Like Some Tax Benefits for His Investment Expenses