7) Due to stress on the job, taxpayer Charlie began to experience chest pains. His doctor advised him to take some time off and relax. In order to relax and relieve the pains, he and his spouse went on an ocean cruise. The cost of the cruise to alleviate this medical condition is tax-deductible. TRUE OR FALSE

8) A capital loss may arise from the sale or exchange of a capital asset. TRUE OR FALSE

9) Which of the following statements regarding independent contractors and employees is true?

A) Independent contractors pay Social Security and Medicare tax of 15.3%.

B) Employees must pay unemployment taxes.

C) Independent contractors and employees pay the same Social Security and Medicare tax rates.

D) Independent contractors deduct their business expenses "from AGI."

10) Capital Losses are limited each year to $5,000. TRUE OR FALSE