Question: Instructions : Please provide 2-3 sentence brief explanation and decide wheter the statement is True or False. All sources must be noted. SHOW ALL WORK.

Instructions : Please provide 2-3 sentence brief explanation and decide wheter the statement is True or False. All sources must be noted. SHOW ALL WORK.

____ A. All employment related expenses are classified as deductions for AGI.

____ B. Harry, a shareholder-employee of Fox, Inc., receives a $350,000 salary. The IRS classifies $100,000 of this amount as unreasonable compensation. The effect of this reclassification is to increase Foxs gross income by $100,000. Harrys income remains the same

____ C. A basketball team that pays a player an annual salary of $10 million can deduct the entire $10 million as salary expense. If the same amount is paid to the CEO of Microsoft, only $5 million is deductible.

____ D. Jill sells land to her adult son, Jim, for its $50,000 appraised value. Her adjusted basis for the land is $60,000. Jills recognized loss is $0 and James adjusted basis for the land is $60,000.

____ E. If a business debt previously deducted as partially worthless becomes totally worthless this year, only the amount not previously deducted can be deducted this year.

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