Milt, a self-employed attorney, incurs the following expenses in the current year:
Dues paid to the local chamber of commerce ………………………….. $1,000
Business lunches for clients and prospective clients (Milt does not believe in conducting business discussions during lunch) …………………………………….. 4,000
Entertainment of professional associates in his home (immediately following business meetings) ………………………………………………………………. 2,000
Country club dues (the club is used exclusively for business) …………. 2,500
Entertainment of clients and prospective clients at the country club
(meals and drinks) ………………………………………………………. 1,500
Total …………………………..………………………………………… $11,000
a. Which of the expenditures listed above (if any) are deductible by Milt?
b. Are each of these items classified as for AGI or from AGI deductions?
c. How would your answers change if Milt was an employee rather than self-employed?