Question

Thelma (39) is single. Her federal adjusted gross income is $75,300. Her itemized deduction expenses are as follows: • Church contributions (with receipts): $7,500. • Unreimbursed employee business expenses: $3,045. • Tax preparation fees: $200. • Fees paid for investment advice: $800. • Legal expense (necessary to collect taxable income): $320. • Safe deposit box (used to keep taxable investment-related documents): $100. What is Thelma's total California itemized deductions?

Answer 1

California still allows miscellaneous itemized deductions subject to a 2% of AGI floor.

2% floor = 0.02 × $75,300 = $1,506.

Miscellaneous deductible expenses:
- Unreimbursed employee business expenses: $3,045
- Tax prep fees: $200
- Investment advice fees: $800
- Legal expense to collect taxable income: $320
- Safe‑deposit box (for investment records): $100
Total miscellaneous = $4,465
Less 2% floor: $4,465 − $1,506 = $2,959

Plus charitable contributions: $7,500

Total California itemized deductions = $7,500 + $2,959 = $10,459.