Some insurance policies have deductibles. A deductible is an amount of a claim not covered byinsurance. It's a fixed portion of the medical bills that the insured person must pay in order tomake a claim to their insurer. Suppose Rosa's insurance company provides two plans. Plan Ahas zero deductibles (good!) but charges a high premium (bad!). Specifically, Plan A charges$591 for full coverage. Plan B has a deductible of $197, but charges a premium of just $199. WillRosa purchase insurance and, if so, which plan?Rosa will not purchase any insuranceRosa will purchase plan ARosa will purchase plan BRosa is indifferent between the two plansO None of the above

In insurance deductibles are those amounts that the policy holder will have to pay before the…

Answered: Some insurance policies have…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter7: Losses—deductions And Limitations

Section: Chapter Questions

Problem 47P

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Home insurance policies may cover jewelry for $1,000 and silverware for $2,500 unless these items are covered with additional insurance. If $3,300 worth of jewelry and $2,100 worth of silverware were stolen from a family, and the policy has a deductible of $1,000, what amount of the claim would not be covered by insurance?
An insurance company notifies an insured thal $50 of lhe insured's physician's charge is above he usual, customary, and reasonable limits covered by the Major Medical policy. In this situation, the excess amount would be. A.applied to the deductible B.paid at he 80/20 coinsurance rate C.disallowed as a covered charge D.charged back o the physician
1. For calendar year 2020, Jean was a self-employed consultant with no employees. She had $80,000 of net profit from consulting and paid $7,000 in medical insurance premiums on her policy covering 2020. How much of these premiums may Jean deduct as a deduction for AGI? As an itemized deduction? If an amount is zero, enter "0". Self-employed persons can deduct ( ) % of their medical insurance premiums as a deduction for AGI in 2020. Thus, Jean may deduct $( ) as a deduction for AGI and she may deduct $ ( )as an itemized deduction (subject to the AGI floor). 2. In December of each year, Eleanor Young contributes 10% of her gross income to the United Way (a 50% organization). Eleanor, who is in the 24% marginal tax bracket, is considering the following alternatives for satisfying the contribution. Fair Market Value (1) Cash donation $23,000 (2) Unimproved land held for six years ($3,000 basis) $23,000 (3) Blue Corporation stock held for eight months ($3,000…
For calendar year 2021, Giana was a self-employed consultant with no employees. She had $80,000 of net profit from consulting and paid $7,000 in medical insurance premiums on her policy covering 2021. How much of these premiums may Giana deduct as a deduction for AGI? As an itemized deduction? If an amount is zero, enter "0". Self-employed persons can deduct fill in the blank 1 % of their medical insurance premiums as a deduction for AGI in 2021. Thus, Giana may deduct $fill in the blank 2 as a deduction AGI and she may deduct $fill in the blank 4 as an itemized deduction (subject to the AGI floor).
A homeowner’s policy was cancelled by the Illinois insurance guaranty fund due to insolvency of the insurance company the unearned premium was $625.00. What is the premium refund due the insured for the unexpired policy period? A.$0 B.$525 C.$625 D.$1150
Employees who elect additional life insurance coverage (Add Life Ins) pay a fee equal to a percentage of their annual salary. The life insurance premium rate is in cell U5. Employees who do not elect additional life insurance pay nothing. In the Life Insurance Premium column, enter an IF function to calculate the life insurance premiums; use an absolute reference to cell U5 to obtain the life insurance rate and enter 0 for employees who do not elect coverage. All full-time employees over the age of 30 are eligible for the 401(k) benefit. In the 401(k) column, enter the IF and AND functions to calculate the 401(k) benefit as 3 percent of annual salary; use an absolute reference to cell U6 to obtain the 401(k) matching percent rate (3 percent). If the employee is not eligible, enter 0. (HINT: the AND function is used as the logical test in the IF function) All employees with one or more years of service are eligible for a bonus. Pay Grade 1 employees receive $3,000 (cell U2), Pay Grade 2…
1. Which of the following is true about the self-employed health insurance deduction? a.The cost of insurance for dependent children is not allowed. b.Long-term care insurance is allowed as a deduction, subject to a dollar limitation. c.Life insurance is allowed as a deduction. d.Medical insurance is allowed as a deduction, subject to a dollar limitation. e.Dental insurance is not part of the allowable deduction. 2. Jody is a physician's assistant (not covered by a retirement plan) with a salary of $40,000 from the hospital where she is employed. She supports her husband, Andre, who sells art work and has no earned income. They have no other sources of income. Both are in their twenties. What is the maximum total amount that Jody and Andre may contribute to their traditional IRAs and deduct for the 2021 tax year? a.$12,000 b.$6,000 c.$5,500 d.$11,000 e.None of these choices are correct. 3. Gail is a single elementary school teacher. She buys the following items for use in her…
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Lokalalo knows that not all their customers will pay so they take out insurance for that purpose. The insurance does not cover them for their full loss unfortunately. Lokalalo pays for the insurance in advance, which gives them 12 months of cover. Lokalalo paid $15,000 on 1 August 2020 for cover for the next 12 months. Paulo Jr. asks you the following questions (You do not need to provide the definition of any assets, liabilities, income or expenses. If you believe there is no effect on one financial statement, please state “no effect” instead of leaving a blank): What happens in the balance sheet at 31 August 2020 and in the income statement and the statement of cash flows for the month of August 2020?
Lokalalo knows that not all their customers will pay so they take out insurance for that purpose. The insurance does not cover them for their full loss unfortunately. Lokalalo pays for the insurance in advance, which gives them 12 months of cover. Lokalalo paid $15,000 on 1 August 2020 for cover for the next 12 months. Paulo Jr. asks you the following questions (You do not need to provide the definition of any assets, liabilities, income or expenses. If you believe there is no effect on one financial statement, please state “no effect” instead of leaving a blank): What happens in the balance sheet, income statement and statement of cash flows on the date of the transaction when the $15,000 is paid?
A taxpayer has a liabilty on their California return greater than $80,000. They cut a check to the State for $100,000 instead of using an E-Pay system. They regularly have large liabilities, and this is not a one-time representation of their income, like a windfall or lottery payment. What is the amount of the penalty that they will pay due to not using the mandatory E-Pay for this liability? in california ftb?
Finn Stone has a PAP with coverage of $15,000/$30,000 for bodily injury liability, $15,000 for property damage liability, $5,000 for medical payments, and a $1,000 deductible for collision insurance. How much will his insurance cover in each of the following situations? Will he have any out-of-pocket costs? Round the answers to the whole dollar, if necessary. Leave no cells blank, be sure to enter "0" wherever required. Finn loses control and skids on ice, running into a parked car and causing $3,635 damage to the unoccupied vehicle and $4,165 damage to his own car. Total paid by the insurance company: $ Finn's out-of-pocket costs: $ Finn runs a stop sign and causes a serious auto accident, badly injuring two people. The injured parties win lawsuits against him for $44,000 each. Total paid by the insurance company: $ Finn's out-of-pocket costs (for both victims): $ Finn's 18-year-old son borrows his car. He backs into a telephone pole and causes $1,300…

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