Holly and Zachary Neal, from Dublin, Virginia, are preparing to file their 2017 income taxes. Their children are grown; however, Holly's mother, Martha, has moved in with them so Holly is no longer working. Martha is dependent on their income for support except for her $533 monthly Social Security benefit.Zachary works for a software company and earns enough to keep their heads above water; however, he had to discontinue participation in his retirement plan so they could pay the bills. Holly is taking this opportunity to work toward her master's degree. They know they will file jointly but need your help preparing their tax return. They have gathered all of the appropriate records.

1. What tax advantage(s), attributable to Holly's education expenses, can the Neals include on their return?

a) There are two tax advantages associated with Holly's education expenses. First, they can claim a Lifetime Learning tax credit of $____, as the Neals' income is below the income phase-out for the credit. Second, the $____ in interest payments is an adjustment to income for the tax year, as again the Neals' income is less than the phase-out level for eligibility. (round to the nearest dollar)

2. How much of the total medical expenses will the Neals be able to deduct on their taxes?

a) Of the total unreimbursed medical expenses, the Neals will be able to deduct $____. (round to the nearest cent)

Holly and Zachary Neal's Records 1099-DIV,CapitalGains,short-termZacharysW-2,WageandTaxStatementGamblingwinningsInheritanceHollyandZacharysaggregatetraditionalIRAcontributionMarthasunreimbursedmedicalexpensesHollyandZacharysunreimbursedmedicalexpensesMarthastotallivingexpenses,excludingmedicalStatetaxeswithheldandowedMortgageinterestexpenseHollysstudentloaninterestpaymentHollyseducationexpense$891$55,500$1,475$31,000$5,000$4,900$1,800$12,000$2,322$6,000$600$5,320