Flo and Artis (wife and husband)are itemizing their Schedule A expenses on their tax year 2016 return.Artis traveled to Japan for his employer,but was not reimbursed.His meal expenses totaled $500.How much can Artis deduct for meals before applying the 2% of AGI limitation?
A)$500.
B)$250.
C)$150.
D)$0.

Question

Quizplus · Accepted Answer

Artis can only deduct the amount of his meal expenses that exceeds 2% of his adjusted gross income (AGI). Let's assume his AGI is $50,000. Then, 2% of his AGI would be $1,000. Artis can only deduct the amount that exceeds $1,000.

In this case, Artis' meal expenses were $500. Since $500 is less than $1,000, Artis cannot deduct any part of his meal expenses on this year's tax return. So the correct answer is D) $0.

However, if Artis had other miscellaneous expenses that he was itemizing, and those expenses combined with his meal expenses exceeded $1,000, then he could deduct the portion of his meal expenses that exceeded $1,000. In that scenario, Artis could deduct $250, which is the amount by which his meal expenses exceed the 2% of AGI limitation.

Flo and Artis (Wife and Husband)are Itemizing Their Schedule a Expenses