In 2012, Jorge, who is single with no dependents, has AGI of $48,000 and unreimbursed medical costs of $8,900. How much of his medical expenses can be claimed as an itemized deduction?
a. Incorrect. Although Jorge cannot deduct all of his medical costs because of the AGI threshold, he can claim a partial deduction of medical costs.
b. Correct. His deduction is limited to medical costs exceeding 7.5% of AGI ([$48,000 × 7.5%] = $3,600), which means Jorge can deduct $5,300 ($8,900 – $3,600).
c. Incorrect. He cannot deduct all of his medical costs ($8,900) because of the AGI threshold.
d. Incorrect. $3,600 ($48,000 × 7.5%) is his 7.5% of AGI threshold.