Reg 6 Flashcards
What are cost that need to be capitalized under the Uniform Capitalization Rule
preproduction costs:
design, bidding, purchasing expenses,
production costs: direct labor, direct materials,
indirect production costs
presale costs (storage, handling, excise tax)
what is the limit on business gifts that are deductible
25 per gift
Where are hobby expense reported - what schedule
Schedule A - as a misc deduction subject to the 2% AGI floor
Can you deduct if your contribution is to a foreign charity
No
must be local and must have a letter if over 250
when can you deduct home mortgage interest ad when can you deduct on a vacant lot
yes home mortgage interest fir primary and secondary but NO to vacation rental
what are acceptable items included in unreimbursed employee expenses
union dues subscriptions to trade journals job hunting expenses work cloths as long as you CANT wear them other places Not a newpaper
can you deduct bank charges
bank charges can not because they are not employee or investment expenses
Is state disability received taxable
No if received because of an injury on the job
When are pension plan benefits taxable
They are taxable when the costs of the plan are incurred by your employer
If you pay into then this is considered a return of capital - then not taxable
When and how can you deduct a penalty for early withdrawal on a CD
It is considered a reduction in interest earned so it is a deduction on the Page 1 of the 1040
Where and how do you deduct a home improvement directly related to medical conditions
The cost net of the increase value of the house can be deducted on schedule A subject to the 10% hurdle
Can you deduct the amortization over the life of points paid to refinance the mortgage at a lower rate
yes - fully deductible on schedule A as an itemized deduction
how are gambling losses deducted in schedule A
fully deductible on schedule A to the extent of winning
