ACC 456 STUDY Start With a Dream /acc456study.com ACC 456 STUDY Start With a Dream /acc456study.com | Page 20

7-31
Wayne and Maria file a joint tax return on which they itemize their
deductions and report AGI of $50,000. During the year they incurred
$1,500 of medical expenses when Maria broke her leg. Furthermore,
their dentist informed them that their daughter, Alicia, needs $3,000 of
orthodontic work to correct her overbite. Wayne also needs a new pair
of eyeglasses that will cost $300. What tax issues should Wayne and
Maria consider?
I:7-32
This year, Chuck took out a loan to purchase some raw land for
investment. He paid $40,000 for the land, and he expects that within 5
years the land will be worth at least $75,000. Chuck is married, and his
AGI for the year is $230,000. Chuck paid $4,300 in interest on the
loan this year. Chuck has $2,600 in interest income and $1,300 in
dividend income for the year. He plans to itemize his deductions so he
can use the interest expense to offset his investment income. What tax
issues should Chuck consider?
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