The Zhang Trust incurred the following items during the year. What is Zhang's deduction for the tax preparation fees?

Question

The Zhang Trust incurred the following items during the year.  What is Zhang's deduction for the tax preparation fees?

Quizplus · Accepted Answer

Tax preparation fees are deductible as miscellaneous itemized deductions, subject to a 2% floor. The total amount of miscellaneous deductions must exceed 2% of Adjusted Gross Income (AGI) in order to be deductible. In this case, the only itemized deduction is for tax preparation fees of $4,000. Thus, assuming the taxpayer's AGI is high enough, the taxpayer can deduct the $4,000 in tax preparation fees.

The Zhang Trust Incurred the Following Items During the Year