Memorandum

Facts

Michael $($a regional manager at D&M Co$.)$ and Holly $($a part$-$time HR representative$)$ are

married and live in New Jersey with their son Dwight. Michael has cancer and his

physician, Dr$.$ Halpert, recommends Holly attend a conference at a renowned clinic in

Chicago, Illinois that teaches caregivers how to take better care of their loved ones with

the illness. Holly takes the physician$$s advice and flies to Chicago for the conference,

which is $5$ days. Holly incurs the following expenses and uses some of her savings and

inheritance to cover these costs: airfare $[$$$1,200],$ meals $[$$$75$ per day$],$ hotel $[$$$325$ per

day$],$ and fees to register for the conference $[$$$2,300].$ A prominent speaker at the

conference, Toby, encouraged caregivers to travel with their patients to warmer

climates where the change in scenery can improve their morale and overall well$-$being.

Both Holly and Michael have always wanted to visit the Caribbean and dream of

escaping to its beaches and pristine waters. Holly returns from the conference and

immediately schedules a three$-$month trip to the Cayman Islands for Michael and herself

to enjoy the warm weather and bask in the sunshine. A week into the trip $($unbeknownst

to Michael$),$ his father, Oscar, and good friends Daryl, Meredith and Jo arrive and stay

with the couple for a few weeks.

Moreover, Holly is way over due for a new vehicle $($her current car is $15$ years old$).$ She

has heard many great things about plug$-$in electric vehicles and is considering

purchasing one $($e$.$g$.,$ a Tesla$)$ rather than a standard car. She is wondering if there are

tax benefits to purchasing an electric vehicle and if there is any difference for tax

purposes between a brand new EV or a pre$-$owned EV$.$

Holly and Michael$$s adjusted gross income $($AGI$)$ is $$41,000.$ Although Michael and

Holly have in$-$depth knowledge about paper and office supplies, they are unfamiliar with

the tax implications of the above transactions and have asked for your help. Please summarize the facts and issue of this for a tax memo, will thumbs up$!!$