Answer:
Linda is allowed to deduct $935 in the current year for these expenses in 2022.
Step-by-step explanation:
In general, the IRS allows self-employed individuals to deduct expenses that are "ordinary and necessary" for their business. This includes expenses for business meals and entertainment, but there are some limitations and requirements.
For business meals, the IRS allows a deduction of up to 50% of the cost. In this case, Linda spent $770 on business meals, so her deduction would be:
$770 x 50% = $385
For business entertainment, the rules are a bit more complicated. Entertainment expenses are generally not deductible, but there are some exceptions. One of these exceptions is for "entertainment that is directly related to the active conduct of a trade or business." This means that if Linda can show that the entertainment was directly related to her business and was intended to generate business income or goodwill, she may be able to deduct some or all of the expense.
In this case, Linda spent $550 on opera tickets for entertaining customers. If she can demonstrate that the entertainment was directly related to her business and was intended to generate business income or goodwill, she may be able to deduct all or a portion of the expense. However, without additional information about the purpose and context of the entertainment, it's impossible to determine exactly how much of the expense is deductible.
Assuming Linda is able to deduct the full amount of the business entertainment expense, her total deduction for the two expenses would be:
$385 (business meals) + $550 (business entertainment) = $935
Therefore, Linda is allowed to deduct $935 in the current year for these expenses in 2022.