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

Itemized Deductions

Summary and Exercises

Question 4 of 4

Guillermo and Esmeralda live in Puerto Rico, use the Married Filing Jointly filing status, and itemize their deductions. During this tax year, Guillermo worked for the U.S. government and earned $49,965. Esmeralda did not work but received $2,452 interest from her savings account at Banco Popular of Puerto Rico.

Their expenses were:

Expense Amount

Out-of-pocket dental expenses

$750

Real estate taxes

$875

Interest on home mortgage

$9,200

Charitable contributions (cash)

$1,821

Remember, the formula for calculating the allowable portion of a deduction is:

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

Based on this information, what are their total itemized deductions from line 17 of their Schedule A?

$11,339
$9,200
$8,769
$0