Final answer:
The expense not subject to the 2% of AGI floor is the interest expense on rental property, which is deductible on Schedule E and not as a miscellaneous itemized deduction.
Step-by-step explanation:
The student asked which of the following expenses is NOT considered a deductible investment expense subject to the 2% of Adjusted Gross Income (AGI) floor. The correct answer is a. Interest expense on rental property. Interest on rental property is typically deductible on Schedule E and thus, is not subject to the 2% AGI floor that applies to miscellaneous itemized deductions. Other expenses such as subscriptions to investment-related publications, investment advisory fees, and safe-deposit box fees were previously considered miscellaneous itemized deductions subject to the 2% AGI floor before the Tax Cuts and Jobs Act of 2017, which suspended these deductions for tax years 2018 through 2025.