The following information applies to the questions displayed below.] Charles has
ID: 2541192 • Letter: T
Question
The following information applies to the questions displayed below.] Charles has AGI of $50,000 and has made the following payments related to () land he inherited from his deceased aunt and (2) a personal vacation taken last year. State inheritance tax on the land County real estate tax on the land School district tax on the land city special assessment on the land (replacing curbs and gutters) State tax on airline tickets (paid on vacation) Local hotel tax (paid during vacation) $ 1,280 1,500 690 780 125 195 Calculate the amount of taxes Charles may include in his itemized deductions for the year under the following circumstances: (Leave no answer blank. Enter zero if applicable.) c. Suppose that Charles holds the land for appreciation and that the vacation was actually a business trip. (Apply limits if applicaExplanation / Answer
The inheritance tax is nondeductible personal expenses. The special assessment is also not deductible because it is capitalized to the value of the property.However, the airline tax and the hotel tax are deductible unreimbursed business expenses (miscellaneous itemized deduction subject to2% AGI floor).
Because the $320 airline and hotel tax does not exceed the 2% floor ($50,000 × 2% = $1,000), the amount is the $2190 ($1500+ $690)
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