Itemized Deductions- Other

Question 1

What are requirements to deduct charitable contributions?

Answer 1

• Must be to a qualified charity (political organizations don’t count)
• Must be cash or property, not services

Question 2

What is the charitable contribution deduction for LTCG property?

Answer 2

• FMV is deductible. Limited to 30% of AGI

- Limited to AB if charitable organization doesn’t use property in manner related to tax exempt purpose

Question 3

What is the charitable contribution deduction for property other than LTCG?

Answer 3

• FMV of property reduced by ordinary income or STCG that would’ve been recognized if property was sold
• If FMV less than AB, limited to FMV

Question 4

Do clothing and household goods qualify for charitable contribution deductions?

Answer 4

-Only if items are in good used condition or better

Question 5

What are the writing requirements for charitable contributions?

Answer 5

• No deduction allowed for single contribution of $250 or more unless written acknowledgement received
• Contributions of cash not deductible unless donor has canceled check, credit card statement, or written statement from charity
• For property valued at more than $500, description of property must be provided
• Qualified appraisal required for donations of property worth more than $5,000
• For property worth more than $500,000 qualified appraisal must be attached to tax return

Question 6

What is the overall limitation for an individual’s aggregate contribution to charities? What is carryforward period?

Answer 6

• Limited to 50% of AGI

- 5 years

Question 7

Define casualty.

Answer 7

-A sudden, unexpected event damaging or destroying an asset

Question 8

When are casualty losses deducted?

Answer 8

-When casualty occurs or theft is discovered

Question 9

What is the computation for personal casualty losses?

Answer 9

Lower of decline in FMV or AB of property

• Insurance reimbursements
• $100 per casualty
• 10% of AGI

Question 10

Remember all casualty gains and losses are netted. How do we treat net casualty gains?

Answer 10

-As capital gains

Question 11

What are the 7 major types of 2% miscellaneous itemized deductions?

Answer 11

• Employee business expenses not reimbursed under an accountable plan
• Investment expenses (not rental or royalty)
• Tax return preparation expenses
• Home office expenses of an employee
• Hobby expenses
• Appraisal fees to determine casualty loss
• Legal fees to procure alimony

Question 12

What are some itemized deductions not subject to the 2% floor?

Answer 12

• Repayments previously included in income under claim of right doctrine
• Remaining basis of terminated annuity
• Gambling losses to extent of gambling winnings