Albert Gaytor and his wife Allison are married and file a joint return for 2016. The Gaytors live at 12340 Cocoshell Road, Coral Gables, FL 33134. Mr. Gaytor is a charter fishing boat captain but took 6 months off from his job in 2016 to train and study for his Masters Captains License.

Name	Social Security Number	Date of Birth
Albert T. Gaytor	266-51-1966	09/22/1967
Allison A. Gaytor	266-34-1967	07/01/1968
Crocker Gaytor	261-55-1212	12/21/1999
Cayman Slacker	261-11-4444	03/13/1998
Sean Slacker	344-23-5656	05/01/1997

The Gaytors have a 17-year-old son, Crocker, who is enrolled in the eleventh grade at the Bucholz Preparatory School. The Gaytors also have an 18-year-old daughter, Cayman, who is a part-time freshman student at Dade County Community College (DCCC). Cayman is married to Sean Slacker, who is 19 years old and a part-time student at DCCC. Sean and Cayman have a 1-year-old child, Wanda Slacker (Social Security number 648-99-4306). Sean, Cayman, and Wanda all live in an apartment up the street from Albert and Allison during the entire current calendar year. Sean and Cayman both work for Seans wealthy grandfather as apprentices in his business. Their wages for the year were a combined $50,000, which allowed them to pay all the personal expenses for themselves and their daughter. Albert and Allison have savings account and received the following Form 1099:

In 2016, Albert received a Form W-2 from his employer, Coconut Grove Fishing Charters, Inc

The following additional information is available for the family of Albert and Allison Gaytor. In 2016, Albert received a Form W-2 from his employer, Coconut Grove Fishing Charters, Inc.:

In addition to the interest from Chapter 1, Albert and Allison also received three Form 1099s:

The Gaytors also received qualified dividends of $500 from Florida Sugar Corp. and interest of $725 from bonds issued by the Miami-Dade County Airport Authority(Form 1099s not shown).

Albert went to the casino on his birthday and won big, as reflected on the following Form W-2G:

Albert had no other gambling income or losses for the year

In February, Allison received $50,000 in life insurance proceeds from the death of her friend, Sharon.

In July, Alberts uncle Ivan died and left him real estate (undeveloped land) worth $72,000. Five years ago, Albert and Allison divorced. Albert married Iris, but the marriage did not work out and they divorced a year later. Under the divorce decree, Albert pays Iris $11,400 per year in alimony. All payments were on time in 2016 and Iris Social Security number is 667-34-9224. Three years ago, Albert and Allison were remarried.

Coconut Fishing Charters, Inc. pays Alberts captains license fees and membership dues to the Charter Fishermans Association. During 2016, Coconut Fishing paid $1,300 for such dues and fees for Albert.

Allison was laid off from her job on January 2, 2016. For 2016, she received a Form 1099-G for unemployment benefits:

Albert and his family are covered by an employee-sponsored health plan at his work. Coconut Fishing pays $700 per month in premiums for Albert and his family. During the year, Allison was in the hospital for appendix surgery. The bill for the surgery was $10,100 of which the health insurance reimbursed Albert the full $10,100.

Coconut Fishing also pays for Alberts parking at the marina. The monthly cost is $120.

On September 1, Allison opened a retail store that specializes in sports car accessories. The name of the store is Plus Two Cones. The store is located at 617 Crandon Boulevard, Key Biscayne, FL 33149. The store uses the cash method of accounting and has the EIN 987321654. Allison purchased inventory in August and thus started her business on September 1 with $40,100 of inventory. She purchased an additional $37,800 of inventory in the last four months of 2016 and finished the year with $38,100 of inventory. Her sales revenue for the year equals $63,550 and she had sales returns of $600. Plus Two Cones trial balance for 2016 reflects the following expenses:

Rentretail store	$7,495
Office expenses	1,375
Insurance	795
Fine paid to Washington for environmental damage from oil spill	900
Advertising	3,100
Employee wages	3,400
Payroll and other business taxes	510
Interest on bank business loan	1,750
Accounting fees	310
Business gifts	180
Supplies	625
Utilities	980
Uniforms	400
Telephone	800
Maintenance	432
Miscellaneous	73

In addition to the above items, Allison incurred travel expenses to attend a seminar on sports car accessories. She spent $300 on airfare, $400 on lodging, $90 on a rental car, and $150 on meals. Allison has proper receipts for these amounts.

A review of the gift account details shows that Allison gave a $30 gift to each of her six best suppliers.

The supplies expense account detail reflects the purchase of 250 pens with the Plus Two Cones logo inscribed on each pen. Allison gave the pens away to suppliers, customers, and other business contacts before the end of the year.

Uniforms expense reflects the cost to purchase polo shirts Allison provided for each employee (but not herself). The shirts have the Plus Two Cones logo printed on the front and back and are the required apparel while working but otherwise are just like any other polo shirts.

Allison drove her 2008 Ford Explorer 1,700 miles for business related to Plus Two Cones. The Explorer was driven a total of 13,172 miles for the year. Included in the total 13,172 miles is 5,000 miles spent commuting to the store. Allison has the required substantiation for this business mileage. She uses the standard mileage method.

In July, Albert loaned a friend $7,000 so he could buy a car. Alberts friend lost his job in 2016 and stopped making payments on the loan. He plans to start making payments again, however, with additional interest as soon as he has new employment.

In late 2016, Albert started to mount and stuff some of his trophy fish to display in his man cave at the Gaytors home. Some of his friends liked Alberts taxidermy work and asked him to prepare a couple of trophy fish for them as well. Although he doubts he will ever sell any more stuffed fish, he was paid $150 and had no expenses related to this activity in 2016.

The following additional information is available for the Albert and Allison Gaytorfamily.

The Gaytors own a rental beach house in Hawaii. The beach house was rentedfor the full year during 2016 and was not used by the Gaytors during the year.The Gaytors were active participants in the management of the rental house.Pertinent information about the rental house is as follows:Address: 1237 Pineapple St., Lihue, HI 96766

Net rental income	$20,650
Mortgage interest	7,900
Real estate taxes	2,300
Utilities	2,125
Maintenance	2,900

The house is fully depreciated so there is no depreciation expense.

For the 2016 tax year, on March 15, 2017, Albert contributes $5,500 to a traditional IRA for himself and $5,500 to a traditional IRA for his wife. He is not covered by a qualified retirement plan at work. Allison had a retirement plan at the job from which she was laid off on January 2, 2016. The plan had a balance of $24,000. Allison received the following Form 1099-R in 2016:

Albert and Allison also received the following form:

Albert and Allison paid the following in 2016 (all by check or can otherwise be substantiated):

In August 2016, Crocker was on an out of town field trip with the high school band and his appendix burst. He required immediate surgery which was considered out of network for the Gaytors health plan resulting in hospital and doctors fees of $3,000 not covered by insurance. In addition, Allison drove 300 miles to be with Crocker after the surgery and drive him home after he recovered. She spent two nights in a hotel at a cost of $140 per night.I

In June, Albert purchased a new professional digital SLR camera for $7,950. While the Gaytors were on vacation in August, someone broke into their residence and stole the camera. Alberts homeowners insurance did not reimburse him for any part of the loss since he declined the special premium add-on for high value items required by his policy.

Combine this information about the Gaytor family and complete a 2016 tax return for Albert and Allison.

Hint: following are the forms and schedules for this assignment:

Schedule A - Schedule B - Schedule C - Schedule E - Form 4684 - Form 8880 - Form 8582 - Page 1 - - Form 8582 Page 2 (Regular Tax)

Your checkpoint: line 43 of 2016 1040 = 20,509

CORRECTED (fif checked PAYER'S namo, street addross, city or town, state or province, country, ZIP or foreign postal code, and telephone o. Payer's RTN (optional OMB 1545-0112 Vizcaya National Bank 9871 Coral Way Miami, FL 33134 2016 Interest Income 1 Interest income 375.05 Form 1099-INT 2 Earty withdrawal penalty Copy B PAYERS tadsral identification number RECIPIENTS Identification numbar $ For Recipient 60-7654321 266-51-1966 3 Interest on U.S. Savings Bonds and Treas obligations This is important tax nformation and is furnished to the RECIPIENT'S name 4 Federal incamo tax Albert T. Gaytor 6 Foreign tax paid Forsign country ar us possesm] Intemal,Revenue Service, If you are required to file a 9 Specifed pmale adivily bond return, a negligence penalty or other sanction may be ou if this income is taxable and the IAS determines that it has not been reported Street address (including apt. no 12340 Cocoshell Road City or town, state ar province, cauntry, and 2IP ar foreign postal codeS Coral Gables, FL 33134 8 Tax-exermpt intereet interest imposed on y 10 Market discount 11 Bond premium FATCA filing S 12 Bond prenin ri Trees tigaforel 1 Bond premium on t a-eseTpt 14 Tax-cxampt and tax credit 15 State 16 State iclenaicaton no. 17 State tax withhold bond CUS P no. Fomn 1099-INT (keep for your records) www.irsgowlom1099int Departrment of the Treasury-Interal Revenue Service CORRECTED (fif checked PAYER'S namo, street addross, city or town, state or province, country, ZIP or foreign postal code, and telephone o. Payer's RTN (optional OMB 1545-0112 Vizcaya National Bank 9871 Coral Way Miami, FL 33134 2016 Interest Income 1 Interest income 375.05 Form 1099-INT 2 Earty withdrawal penalty Copy B PAYERS tadsral identification number RECIPIENTS Identification numbar $ For Recipient 60-7654321 266-51-1966 3 Interest on U.S. Savings Bonds and Treas obligations This is important tax nformation and is furnished to the RECIPIENT'S name 4 Federal incamo tax Albert T. Gaytor 6 Foreign tax paid Forsign country ar us possesm] Intemal,Revenue Service, If you are required to file a 9 Specifed pmale adivily bond return, a negligence penalty or other sanction may be ou if this income is taxable and the IAS determines that it has not been reported Street address (including apt. no 12340 Cocoshell Road City or town, state ar province, cauntry, and 2IP ar foreign postal codeS Coral Gables, FL 33134 8 Tax-exermpt intereet interest imposed on y 10 Market discount 11 Bond premium FATCA filing S 12 Bond prenin ri Trees tigaforel 1 Bond premium on t a-eseTpt 14 Tax-cxampt and tax credit 15 State 16 State iclenaicaton no. 17 State tax withhold bond CUS P no. Fomn 1099-INT (keep for your records) www.irsgowlom1099int Departrment of the Treasury-Interal Revenue Service