During 2015, James, a single, cash method taxpayer incurred the following expenditures:

Qualified medical expenses $8,000

Investment interest expense $16,000

Other investment activity expenses

Interest on loan on personal auto $2,000

Charitable contributions $3,000

State income tax paid $7,000

State sales tax paid $4,500

Property taxes $4,000

Tax return preparation and consulting fees $5,000

James' income consisted of the following items:

Salary $70,000

Interest income $20,000

Long-term capital gains $23,000

Long-term capital losses (15,000)

a) Compute James' taxable income for the year (assuming that he makes an election to have the net capital gain taxed at the regular tax rates). Also assume that James is 67 years old. Thus, his medical expense deduction is subject to the 7.5% rather than the 10% limit.

b) What is James' investment taxable interest carryover (if any)?