Ask Question
20 February, 00:21

Mr. and Mrs. Sloan incurred the following expenses during the current year, when they adopted a child: Child's medical expenses $5,000 Legal expenses 9,000 Agency fee 4,000 Before consideration of any "floor" or other limitation on deductibility, what amount of the above expenses may the Sloans deduct on their current year joint income tax return? gaodun

+2
Answers (1)
  1. 20 February, 01:39
    0
    Answer: See explanation below for answer. The options are:

    A. $13,000

    B. $ 5,000

    C. $18,000

    D. $14,000

    Explanation:

    A taxpayer can deduct the medical expenses that have been paid for a child at the time of adoption if the child should qualify as the dependent of the taxpayer when the medical expenses were paid.

    In addition, should a taxpayer pay an adoption agency for the medical expenses that the adoption agency has already paid, then the taxpayer is treated as though he/she has already paid those expenses.

    In the scenario given above, Mr. and Mrs. Sloan can deduct the child's medical expenses of $5,000 that they have paid.

    But on the other hand, the legal expenses of $9,000 and agency fee of $4,000 that were incurred in during the adoption process will be treated as nondeductible personal expenses.

    However, Mr. and Mrs. Sloan will be able to claim a nonrefundable tax credit amounting up to $13,570 for these qualified adoption expenses.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Mr. and Mrs. Sloan incurred the following expenses during the current year, when they adopted a child: Child's medical expenses $5,000 ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers