[The following information applies to the questions displayed below.]

Clem is married and is a skilled carpenter. Clem's wife, Wanda, works part time as a substitute grade school teacher. Determine the amount of Clem's expenses that are deductible for AGI this year (if any) under the following independent circumstances:

Note: Leave no answer blank. Enter zero if applicable.

1A

a. Clem is self-employed, and this year he incurred $830 in expenses for tools and supplies related to his job. Because neither was covered by a qualified health plan, Clem paid health insurance premiums of $5,490 to provide coverage for himself and Wanda (not through an exchange).

b. Clem and Wanda own a garage downtown that they rent to a local business for storage. This year they incurred expenses of $1,270 in utilities and $985 in depreciation.

c. Clem paid self-employment tax of $17,600 (the employer portion is $8,800), and Wanda had $3,500 of Social Security taxes withheld from her pay.

d.Clem paid $75 to rent a safety deposit box to store his coin collection. Clem has collected coins intermittently since he was a child, and he expects to sell his collection when he retires.

1B

Hardaway earned $115,500 of compensation this year. He also paid (or had paid for him) $3,050 of health insurance (not through an exchange).

What is Hardaway's AGI in each of the following situations? (Ignore the effects of Social Security and self-employment taxes.)

a. Hardaway is an employee, and his employer paid Hardaway's $3,050 of health insurance for him as a nontaxable fringe benefit. Consequently, Hardaway received $112,450 of taxable compensation and $3,050 of nontaxable compensation.

b. Hardaway is a self-employed taxpayer, and he paid $3,050 of health insurance himself. He is not eligible to participate in an employer-sponsored plan.

1C

Lionel is an unmarried law student at State University Law School, a qualified educational institution. This year Lionel borrowed $29,000 from County Bank and paid interest of $1,740. Lionel used the loan proceeds to pay his law school tuition. Calculate the amounts Lionel can deduct for interest on higher-education loans under the following circumstances:

Note: Leave no answer blank. Enter zero if applicable.

a. Lionel's AGI before deducting interest on higher-education loans is $50,000.

b. Lionel's AGI before deducting interest on higher-education loans is $79,000

c. Lionel's AGI before deducting interest on higher-education loans is $90,000.