28. In 2010, Van receives $20,000 (of which $4,000 is earnings) from a qualified tuition program. He

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28. In 2010, Van receives $20,000 (of which $4,000 is earnings) from a qualified tuition program. He uses the funds to pay for his college tuition and other qualified higher education expenses. How much of the $20,000 is taxable to Van?

1. John Williams (age 42) is a single taxpayer, and he lives at 1324 Forest Dr., Reno, NV 89501. His Social Security number is 555-94-9358. John’s earnings and withholdings as the manager of a local casino for 2010 are:
Earnings from the Lucky Ace Casino $200,000 Federal income tax withheld 32,000 State income tax withheld 0 John’s other income includes interest on a savings account at Nevada National Bank of $13,075.
John pays his ex-wife $4,000 per month. When their 12-year-old child (in the wife’s custody) reaches 18, the payments are reduced to $2,800 per month. His ex-wife’s Social Security number is 554-44-5555.
During the year, John paid the following amounts (all of which can be substantiated):
Credit card interest 1,760 Auto loan interest 4,300 Auto insurance 900 Property taxes on personal residence 6,200 State and local sales taxes actually paid during 2010 4,000 Blue Cross health insurance premiums 1,800 Other medical expenses 790 Income tax preparation fee 900 Charitable contributions:
Boy Scouts 800 St. Matthews Church 300 U. of Nevada (Reno) Medical School 30,000 Nevada Democratic Party 250 Fund-raising dinner for the Reno Auto Museum (value of dinner is $50)
100 John also received the following Form 1098:

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Required: Complete John’s federal tax return for 2010. Use Form 1040, Schedule A, Schedule B, and Schedule Mfrom pages 5-47 through 5-52 to complete this tax return.
Make realistic assumptions about any missing data.

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Related Book For  book-img-for-question

Income Tax Fundamentals 2011

ISBN: 9780538469197

29th Edition

Authors: Gerald E. Whittenburg, Martha Altus-Buller

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