Indicate the proper treatment in the current year for the underlined amounts. Treat each item as an independent event. Indicate whether the amount is deductible or not; if deductible whether it is deductible FOR or FROM AGI; and indicate the amount of the deduction for the current year considering any relevant limitations. Assume the taxpayer has deductions greater than the standard deduction, has AGI of $69,000 without regard to the following transactions and has no "total" income limitations related to itemized deductions.
-Self-employed salesman spends $200 on meals while out of town on business. Amount: $100
A)Not Deductible
B)Deductible - For AGI
C)Deductible - From AGI

Question

Quizplus · Accepted Answer

The meals expense for a self-employed individual is deductible as a business expense, which is a deduction "For AGI." However, only 50% of the meal expense is deductible, so $100 is deductible.

Indicate the Proper Treatment in the Current Year for the Underlined