$26.$ During $2021,$ Albert redeems Series EE savings bonds for $\backslash (\backslash$$ $6,000\backslash )--$ consisting of $\backslash (\backslash$$ $2,000\backslash )$ interest and $\backslash (\backslash$$ $4,000\backslash )$ principal. Albert has net qualifying education expenses of $\backslash (\backslash$$ $5,000\backslash )$ in $20$x$1.$ Albert, a single individual, reports adjusted gross income $($without the savings bond interest$)$ of $\backslash (\backslash$$ $20,000\backslash ).$ How much may Albert exclude on his $20$x$1$ Form $1040?$

A $\backslash (\backslash$$ $1,670\backslash )$

B $\backslash (\backslash$quad $1,000\backslash )$

C $2,000$

D $330$

E None of the above

$27.$ Louise Lewis, age $72,$ is married and supports her mother, age $96.$ During $20$x$2.$ Louise pays $\backslash (\backslash$$ $1,300\backslash )$ for prescription medicine for her mother, who is claimed as a dependent, $\backslash (\backslash$$ $1,000\backslash )$ for prescription medicine for her husband, and $\backslash (\backslash$$ $3,400\backslash )$ for physician bills for herself. Louise's gross income is $\backslash (\backslash$$ $55,000\backslash )$ and her adjusted gross income is $\backslash (\backslash$$ $50,000\backslash ).$ Assuming that Louise has sufficient other deductions to itemize for $20$x$2,$ how much medical expense will will Louise and her husband actually deduct on their joint $20$x$2$ Form $1040?$

$28.$ Five year property costing $\backslash (\backslash$$ $25,000\backslash )$ was placed in service on January $\backslash (11,20\backslash$times $1\backslash )$ and $\backslash (\backslash$$ $75,000\backslash )$ of five year property was also placed in service on December $\backslash (4,20\backslash$times $1\backslash ).$ All property is depreciated using MCRS$.$ Neither IRC $179$ nor bonus depreciation is claimed. What will be the $\backslash (20\backslash$times $1\backslash )$ depreciation deduction for the $\backslash (\backslash$mathbf$\{\backslash$$ $25,000\}\backslash )$ asset?

$29.$ Corp. A purchases and pays $\backslash (100\backslash \%\backslash )$ of the premium cost for life insurance on all of its employees. Employee Anne Able, age $56,$ has a policy providing $\backslash (\backslash$$ $40,000\backslash )$ of coverage. Assume that Corp. A pays $\backslash (\backslash$$ $240\mathrm{.}00\backslash )$ actual premium cost for Anne's policy for the year. Based on the above data, Corp. A will include what amount of additional taxable income on Anne's W$-2$ for the year?

$30.$ During $20$x$4,$ Donna Davis $($adjusted gross income of $\backslash (\backslash$$ $70,000\backslash ))$ paid the amounts listed below. Real estate tax $($principal residence$)$

Real estate tax $($vacation home$)$

$\backslash$$$4,000$

$1,000$

State sales tax $($paid to another state while on vacation$)210$

State gasoline tax $($personal vehicle$)400$

Real estate tax on residence belonging to Taxpayer's mother

What amount should Donna claim as an itemized deduction for taxes on her $20$x$4$ Form $1040?$

$31.$ Which, if any, of the listed taxes are not allowable as an itemized deduction?

A$.$ Federal gift tax

B$.$ Federal gasoline excise tax

C$.$ Virginia inheritance tax

D$.$ All are deductible as itemized deductions

E$.$ None are deductible as itemized deductions

$32.$ Which of the following expenditures would not be allowed as an itemized deduction? If more than one would not be allowed, select either D or E$.$

A$.$ A speeding ticket only

B$.$ An expense incurred while operating an illegal gambling business only

C$.$ A government imposed penalty only

D$.$ Neither $\backslash ($ A $\backslash )$ nor $\backslash ($ C $\backslash )$ would be allowed

E$.$ None of the above $--$ neither $\backslash (\backslash$mathrm$\{$A$\},\backslash$mathrm$\{$B$\}\backslash ),$ nor C would be allowed

$33.$ Which of the listed interest expenses can be deducted as an itemized deduction?

A$.$ Home equity loan interest on funds borrowed for tuition for the taxpayers child

B$.$ Personal credit card interest

C$.$ Points paid upon refinancing a loan on rental property

D$.$ Investment interest on money borrowed to purchase municipal bonds

E$.$ None of the above may be deducted as an itemized deduction