Question
match the letter to the correct term Adjustments A. This is the amount that remains after you subtract your allowable adjustments from your gross income.
Adjustments |
| A. | This is the amount that remains after you subtract your allowable adjustments from your gross income. |
Adjusted gross income (AGI) |
| B. | This can be claimed if a taxpayer provides more than half of a persons financial support. |
Deductions |
| C. | Examples of these deductions include employee, personal retirement, higher education, and support expenses, and reduce a taxpayers gross income. |
Standard deductions |
| D. | A charitable contributions is an example. |
Itemized deductions |
| E. | This is a fixed blanket deduction that includes various deductible expenses normally incurred by taxpayers. |
Exemptions |
| F. | Examples of these expenditures include charitable deductions, residential mortgage interest expense, and moving expenses, and are used to reduce a taxpayers AGI. |
Example of an itemized deduction |
| G. | This deduction is created by a taxpayers child and dependent care expenses, the purchase of a qualified electric vehicle, or the payment of foreign taxes or mortgage interest. It results in a dollar-for-dollar reduction in a taxpayers tax obligation. |
Capital gain |
| H. | This term refers to allowable expenses that are deducted from a taxpayers adjusted gross income (AGI). |
Tax credit |
| I. | This objective can be achieved with effective tax planning activities. It is legal and consistent with the intent of Congress. |
Tax avoidance |
| J. | This type of transaction is created when an asset (e.g., a stock, bond, or real estate) is sold for more than its original cost. |
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