1. Tiffany Potter is single and has two children, Allen and Lee Ann, from her previous marriage. Allen lives with Tiffany, with occasional visits to his dad, Will, and Tiffany provides more than half of his support. Allen graduated from high school in December 2018 and began attending college in January 2019. As a straight-A high school student, Allen received a merit scholarship that covers the cost of his entire tuition, fees, books, and supplies, for a total of $40,000, at a nearby private university. Over the summer, Allen earned $1,000 working at an internship with an accounting firm. He also earned $300 of interest income. Lee Ann lived with Will for all of the current year, with occasional visits to her mom. Will provides more than half of Lee Ann's support. Tiffany pays alimony of $400 per month to Will based on their divorce decree, which was entered in 2006. The payments are to continue until Lee Ann reaches age 18, when they will be reduced to $250. Lee Ann is a full time high school student and does not work. Tiffany's birthday is May 31, 1970. Allen's birthday is October 5, 2000. Lee Ann's birthday is December 1, 2004. Tiffany uses the cash method of accounting and a calendar year for reporting. Tiffany prefers to report any kiddie tax on her tax return. 2. Tiffany is employed as a nuclear engineer with Atom Systems Consultants, Inc. (ASCI). Tiffany's pay stubs indicate that she had $7,320 withheld in federal taxes, $4,987 in state taxes. She earned $80,000 of wages subject to employee Social Security taxes and Medicare taxes. ASCI has an extensive fringe benefits program for its employees. 3. Tiffany earned a salary of $82,500 (before subtracting her 401(k) and flexible spending plan contributions). She contributed $6,500 to her 401(k) account, and she contributed $2,650 to a medical flexible spending account. 4. ASCI paid $250 of group-term life insurance premiums to cover Tiffany's personal term life insurance policy for a total death benefit of $200,000. ASCI paid health insurance premiums for Tiffany and Allen of $22,500. ASCI also paid health club dues of $825 to a nearby health club on Tiffany's behalf. 5. Taking advantage of ASCI's educational assistance program, during the fall Tiffany enrolled in two graduate engineering classes at a local university. ASCI paid her tuition, fees, and other course-related costs of $5,300. 6. Tiffany received free parking in the company's security garage that would normally cost $250 per month. 7. Tiffany manages the safety program for ASCI. In recognition of her superior handling of three potential crises during the year, Tiffany was awarded the Employee Safety Award on December 15. The cash award was $400. 8. On July 15 of the current year, Tiffany's father died. From her father's estate, she received stock valued at $30,000 (fathers basis was $12,000) and her fathers house valued at $95,000 (fathers basis in the house was $55,000). 9. Tiffany owns several other investments and received the following information reports for the current tax year: Form 1009-Div: General Dynamics gross qualified dividends - $600 Form 1099-Int New Jersey Economic Development bonds gross interest - $300 IBM bonds gross interest - $1,000 State of Nebraska bonds gross Interest - $200 Form 1098-Mortgage Interest Statement Sunbelt Credit Union mortgage interest - $7,100 Northeast Bank home-equity loan interest - $435 Form K-1 Grubstake Mining and Development: Distribution to shareholder - $1,000 Ordinary income (1% of $200,000) - $2,000 10. In addition to the investments discussed above, Tiffany owns 1,000 shares of Grubstake Mining & Development common stock. Grubstake is organized as an S corporation and has 100,000 shares outstanding. Grubstake reported taxable income of $200,000 and paid a distribution of $1.00 per share during the current year. (See 9.) Tiffany does not materially participate in Grubstake's activities. 11. Tiffany slipped on a wet spot on a visit to a computer store last July. She broke her ankle and was unable to work for two weeks. She incurred $1,300 in medical costs, all of which were paid by the owner of the store. The store also gave her $1,000 for pain and suffering resulting from the injury. ASCI did not pay her salary during the two weeks she missed because of the accident. However, ASCI's disability insurance plan paid her $1,500 in disability pay for the time she was unable to work. Under their plan, ASCI pays the premiums of $500 for the disability insurance as a taxable fringe benefit. The disability plan premiums and the disability benefit payments were not included in Tiffanys W-2 wages reported in paragraph 3. 12. Tiffany received a Form 1099-B from her broker for the sale of the following securities during the current year. The adjusted basis amounts were reported to the IRS. Security Sale Date Purchase Date Sales Price Commission on Sale Tiffanys Basis Nebraska bonds 3/14/2019 10/7/2007 $2,300 $200 $1,890 Cassill Corp. (500 shares) 10/5/2019 2/19/2012 $8,500 $425 $9,760 13. In addition to the taxes withheld from her salary, she also made timely estimated federal tax payments of $175 per quarter and timely estimated state income tax payments of $150 for the first three quarters. The $150 fourth-quarter state payment was made on December 28 of the current year. Tiffany would like to receive a refund for any overpayment. 14. In August of the current year, she received a federal refund of $60 and a state tax refund of $200 related to the tax returns she filed for the prior year. 15. Tiffany found a renter for her father's house and entered into a lease agreement with him starting on August 1. The monthly rent is $400, and the lease agreement is for one year. The lease requires the tenant to pay the first and last months rent and a $400 security deposit. The security deposit is to be returned at the end of the lease if the property is in good condition at that time. On August 1, Tiffany received $1,200 from the tenant per the terms of the lease agreement. In November, the plumbing froze and several pipes burst. The tenant had the repairs made and paid the $300 bill. In December, the tenant reduced her rental payment to $100 to compensate for the plumbing repairs. Tiffany provides you with the following additional information for the rental in the current year. Property taxes $670 Other maintenance expenses $285 Insurance expense $495 Management fee $350 Depreciation (to be computed) ? Local practice is to allocate 10% of the fair market value of the property to the land. (See 8 for basis information.) Tiffany makes all decisions with respect to the property and is an active participant in the rental activity. 16. Tiffany paid $2,050 in real estate taxes on her principal residence. The real estate tax is used to pay for town schools and other municipal services. 17. Tiffany drives a 2016 Acura TL. Her car registration fee (based on the car year) is $50 and covers the period 1/1/19 through 12/31/19. In addition, she paid $280 in property tax to the state based on the book value of the car, which is an ad valorem tax. 18. In addition to the medical costs presented in 11, Tiffany incurred the following medical costs for herself and Allen that were not reimbursed though her medical flexible spending plan or health insurance: Dentist $310 Doctor $390 Prescription drugs $215 Over-the-counter drugs $140 Optometrist $125 Emergency room charges $440 LASIK eye surgery $2,000 Chiropractor $265 19. On April 1, Tiffany took advantage of low interest rates and refinanced her $75,000 home mortgage with her original lender. The new home loan is for 15 years. She paid $215 in closing costs. The house is worth $155,000, and Tiffanys basis in the house is $90,000. As part of the refinancing arrangement, she also obtained a $10,000 home-equity loan. She used the proceeds from the home-equity loan to add an additional bathroom to the house. Tiffany received several Form 1098 statements from her bank for interest paid by her in the current year. Details appear below. (See also 9.) Primary home mortgage $7,100 Home-equity loan $435 Credit cards $498 Car loan $390 20. On May 14 of the current year, Tiffany contributed clothing to the Salvation Army. The original cost of the clothing was $740. She has documentation valuing the donation at a fair market value of $360. In addition, she made the following cash contributions and received a statement from each of the following organizations acknowledging her contribution (all charities are local unless indicated): Larkin College $800 United Way $152 St. Francis Church $790 Amos House (homeless shelter) $200 Mercy Convent, Dublin, Ireland $100 21. Tiffany sells residential real estate in the evening and on weekends (considered an active trade or business). She runs her business from a rental office she shares with other realtors. She frequently takes new clients out for a meal or coffee to discuss their needs before they start looking at homes for sale. Tiffany has been operating in a business-like way since 2003 and has always shown a profit. She had the following income and expenses from her business: Commissions earned: $21,250 Expenses: Advertising $2,200 Meals $1,400 Mobile phone $900 Real estate license $130 Rent $6,000 Utilities $600 22. In February, Tiffany bought a new computer for her residential real estate business that cost $1,500. She used the computer entirely for her business. She intends to expense or depreciate as much as possible on the computer in the first year. 23. She has used her Acura TL in her business during the current year. During the year, she properly documented 5,000 business miles. The total mileage on her car (i.e., business-use and personal-use miles) during the year was 15,000 miles. Tiffany elects to use the standard mileage method to calculate her car expenses. She spent $45 on tolls and $135 on parking related to the real estate business.

1. What is the net Form W-2 wages?
2. What is miscellaneous income?
3. What is Schedule B income (Interest and dividends)?
4. What is Schedule C net income (Business income)?
5. What is Schedule D net income (Capital gains and losses)?
6. What is Schedule E depreciation (Rental property)?
7. What is Schedule E net income (Rental income & Sub-S income)?
8. What is the total For AGI deductions?
9. What is Adjusted Gross Income?
10. What is the Schedule A deduction for taxes?
11. What is the Schedule A deduction for interest expense?
12. What is the Schedule A deduction for charitable contributions?
13. What is the Schedule A total itemized deductions?
14. What is the amount is deducted from AGI to determine taxable income?
15. What is taxable income?
16. What is the tax on ordinary income?
17. What is the tax on long-term capital gain (loss) and qualified dividends?
18. What is the self-employment tax?
19. What is the kiddie tax?
20. What is the balance due or (refund)