Mac received thefollowing income and incurred and paid the following expensesdur

Question

Mac received thefollowing income and incurred and paid the following expensesduring 2008:

Salaryincome                                                                                           $82,000

Dividendincome                                                                                          5,000

Interestincome                                                                                   3,000

Contributions toFirst Church                                                      3,100

Real estate taxeson personalresidence                                        1,900

Alimony paid toformer spouse                                              12,000

Contribution totraditionalIRA                                                 5,000

Mortgage intereston personalresidence                                     6,000

State incometaxes                                                                3,700

Loss on the saleof stock                                                           900

State salestax                                                                1,150

Mac is no yeteligible to participate in his employer’s retirementplan.

a.     Calculate Mac’s AGI.

b.     Should Mac itemize deductions from AGIor take the standard deduction?

Explanation / Answer

:

b) the answer to part b however needs to be more precise

items which would be itemized are:

contributions to the church 3100

real estatetaxes                    1900

interest onmortgage             6000

by all means Mac will itemize

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