Janice, age 32, earns $50,000 working in 2019. She has no other income. Her medical...
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Janice, age 32, earns $50,000 working in 2019. She has no other income. Her medical expenses for the year total $5,250. During the year, she suffers a casualty loss of $7,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). Janice contributes $10,000 to her church. On the advice of her friend, Janice is trying to decide whether to contribute $1,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on Janice's itemized deductions. Without IRA Contribution Gross income $ With IRA Contribution $ 50,000 (1,000) $ 49,000 50,000 0 Contribution to IRA AGI 50,000 Itemized deductions: Charitable contribution $ 1,000 X $ 1,000 x Medical expenses u Casualty loss Total itemized deductions The $1,000 IRA contribution would Janice's itemized deductions by $ . As a result, the $1,000 IRA contribution reduces her taxable income by $
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