TAX

• LIfe Insurance 
• Inheritance (but not the income on such property)
• Damges for personal injury
• Gain from sale of personal residence
• Education expenses
• Fringe benefits  

• 1.Business expenses
• 2.Capital Losses
• 3.Deduction from  rents and royalties
• 4Contributiosn to apporved pension plans and retirement plans
• 5.Alimony
• 6. Moving expenses
• 7. Expenses fro higher education and interest on higher education loans  

Gross income - excusions 

• - above the line deductions (business expenses etc.)
• This number will then comprise adjusted gross income

• Adjusted gross income - below the line deductions
• this equals taxable income 

• Taxable income times tax rate - credits 
•  

They are subtrated from ajusted gross income to determine tax liability. It is either the standard deduction or if greater, an itemized deduction. 

Interest on loans up to 1 million

State local real property taxes

Non business losses

Wagering losses

Charitable contributions up to 50 of AGI.

Medical expenses

Miscellaneous itemized deductiosn to the extent that they exceed 2% of a tax payers AGI.(expenses of profit seeking ventures, educational expenses, employees meals and lodging, transportation, except ordinary commuting expenses.  

Sale of: any property except

• 1. Inventory or other property held primarily for sale to customers
• 2. Depreciable property used in the trade or business
• 3. A copy right
• 4. Accounts or notes recievable
• 5. Supplies  

• 15 percent or
• 28 percent for collectables