Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Itemized Deductions

Determining the Allowable Portion

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Elizabeth and Matthew Leon are Puerto Rican residents in their 40s who use the filing status Married Filing Jointly. During this tax year, Elizabeth earned $32,981 as an employee of the U.S. Department of Agriculture and Matthew earned $18,354 as the manager of a local restaurant. Elizabeth is not sure which expenses are deductible. She gives you this list of expenses:

Expense Amount

Real estate taxes

$1,897

Driver's license renewal

$30

Medical insurance premium

$1,989

Out of pocket doctor's fees

$1,875

Out of pocket dental expenses

$685

Veterinarian expenses

$300

Home mortgage interest

$8,761

The formula for calculating the allowable portion of a deduction is:

(Gross taxable income subject to U.S. tax / Gross income from all sources) x
Deduction = Allowable portion of deduction

Based on the facts given, compute the allowable portion of each itemized deduction and enter it on their Schedule A.

Click here to open Schedule A and complete lines 1, 3, 4, 6, 9, 10, 15, 16, 19, and 29.




Elizabeth and Matthew Leon.