Richard is a sales person for Publix Company. Every month, Richard fills out an expense account report, documenting all his expenses, and submits it for reimbursement. During the current year, Richard submitted documentation and receives $12,500 of reimbursements. All his claims are reimbursed. How will these expenses and reimbursements affect Richard's income tax calculation?
I.Expense amounts are deductible from AGI.II.Reimbursed amounts are excluded from gross income.?
A. Only statement I is correct.
B. Only statement II is correct.
C. Both statements are correct.
D. None of the statements are correct.
Answer: B
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