For AGI deductions of individual taxpayers that are connected with either a trade or business or a rental activity are reported differently than other for AGI deductions reported as Adjustments to Income on Schedule 1 of Form 1040. Explain the difference as to how the two groups are reported for tax purposes.

A. Expenses of a self-employed individual are listed as Adjustments to Gross income on Schedule 1 of Form 1040. Other types of for AGI deductions are listed on Schedule 1 of Form 1099-R.

B. Expenses of a self-employed individual are netted against the income from his business activity and the net amount is reported on Schedule C. The net amount of income from Schedule C is then reported on Line 12 of Schedule 1 of Form 1040. A similar reporting procedure is also followed for Schedule E for rental real estate and Schedule F for a farm. Other types of for AGI deductions are merely listed as Adjustments to Income on Schedule 1 of Form 1040.

C. Expenses of a self-employed individual are reported Schedule 1 of Form 1099-R. Other types of for AGI deductions are listed as Adjustments to Income on Schedule 1 of Form 1040.

D. Expenses of a self-employed individual are netted against the income from his business activity and the net amount is reported on Schedule F. The net amount of income from Schedule F is then reported on Line 12 of Schedule 1 of Form 1040. A similar reporting procedure is also followed for Schedule C for rental real estate and Schedule E for a farm. Other types of for AGI deductions are merely listed as Adjustments to Income on Schedule 1 of Form 1040.