In the 2015 tax year, Michelle paid the following amounts relating to her 2013 tax return — Underpayment estimated penalty 350

What amount of the above items may be deducted on Michelle’s 2015 individual income tax return? $________

SOLUTION

$0. None of the amounts are deductible since

(1) The interest is considered consumer interest which is 100 percent disallowed,

(2) Federal income taxes are not deductible

(3) Fines and penalties are not allowed as deductions.