Alvin Inc was formed in 2000 by Bob Gordon and Lauren Smith. Bob and Lauren officially incorporated their store on June 12, 2000. Alvin sells (retail) all kinds of music-related products including musical instruments, sheet music, CDs, and DVDs. Bob owns 60 percent of the outstanding common stock of Alvin and Lauren owns the remaining 40 percent. Alvin is located at 2604 N Clark St Chicago, IL 60614. Alvin Employer Identification Number is 29-5748859. Alvin's business activity is retail sales of music-related products. Its business activity code is 451140. Officers of the corporation are as follows: o Bob is the chief executive officer and president (Social Security number 123-45- 6789). o Lauren is the executive vice president (Social Security number 978-65-4321). o Dan Bannister is the vice president over operations. o Barry Judd is the secretary. All officers devote 100 percent of their time to the business and all officers are U.S. citizens. Neither Dan nor Barry owns any stock in Alvin. Alvin uses the accrual method of accounting and has a calendar year-end. Alvin made payments that require Form 1099s, and will file the Form 1099s before the tax return is filed. Alvin made four equal estimated tax payments of $43,000 each. Its tax liability last year was $175,000. If it has overpaid its federal tax liability, Alvin would like to receive a refund. Alvin paid a dividend of $80,000 to its shareholders on December 1. Alvin had sufficient earnings and profits (E&P) to cover the distribution.

The following is Alvin's audited income statement for 2021: Alvin Income Statement For year ending December 31, 2021 Revenue from sales $ 3,420,000 Sales returns and allowances (40,000) Cost of goods sold (834,000) Gross profit from operations $ 2,546,000 Other income: Capital gains $ 8,000 Gain from disposition of fixed assets 2,000 Dividend income 12,000 Interest income 15,000 Gross income $2,583,000 Expenses: Compensation $(1,300,000) Depreciation (20,000) Bad debt expense (15,000) Meals (fully deductible) (2,500) Maintenance (7,000) Charitable donations (27,000) Property taxes (45,000) State income taxes (60,000) Other taxes (56,000) Interest (62,000) Advertising (44,000) Professional services (32,000) Pension expense (40,000) Supplies (6,000) Other expenses (38,000) Total expenses (1,757,000) Income before taxes 826,000 Federal income tax expense (260,000) Net income after taxes $ 568,500

Notes: 1. Alvin has a capital loss carryover to this year from last year in the amount of $5,000. 2. Alvins inventory-related purchases during the year were $1,134,000. Alvin values its inventory based on cost using the FIFO inventory cost flow method. Assume the rules of 263A do not apply to Alvin. 3. Of the $15,000 interest income, $2,500 was from a City of Chicago bond issued in 2018, $3,500 was from a Gurnee city bond issued in 2019, $3,000 was from a U.S. Treasury bond, and the remaining $6,000 was from a money market account. 4. Alvin sold equipment for $10,000. It originally purchased the equipment for $12,000 and, through the date of the sale, had recorded a cumulative total of $4,000 of book depreciation on the asset and a cumulative total of $6,000 of tax depreciation. For tax purposes, the entire gain was recaptured as ordinary income under 1245. 5. Alvinss dividend income came from Charlies Sheet Music. Alvin owned 15,000 shares of the stock in Charlies Sheet Music (CSM) at the beginning of the year. This represented 15 percent of the CSM outstanding stock. 6. On July 22, 2021, Alvin sold 2,500 shares of its Charlies Sheet Music stock for $33,000. It had originally purchased these shares on April 24, 2016, for $25,000. After the sale, Alvin owned 12.5 percent of Charlies Sheet Music. 7. Alvins compensation is as follows: Officers, $600,000 Other, $700,000 8. Alvin wrote off $10,000 in accounts receivable as uncollectible during the year. 9. Tax depreciation was $31,000, all attributable to assets purchased prior to 2021 (including the equipment from #4 above). None of the depreciation should be claimed on Form 1125A. No assets were purchased during 2021. 10. Of the $62,000 of interest expense, $56,000 was from the mortgage on Alvins building and the remaining $6,000 of interest was from business-related loans. 11. The pension expense is the same for both book and tax purposes. 12. Other expenses include $3,000 for premiums paid on term life insurance policies for which Alvin is the beneficiary. The policies cover the lives of Bob and Lauren. The following are Alvin's audited balance sheets as of December 31, 2020 and December 31, 2021.

Alvin Inc. Balance Sheet as of December 31, 2021 12/31/2020 12/31/2021 Assets Cash $ 240,000 $ 169,000 Accounts receivable 600,000 700,000 Allowance for doubtful accounts (35,000) (40,000) Inventory 1,400,000 1,700,000 U.S. government bonds 50,000 50,000 State and local bonds 140,000 140,000 Investments in stock 300,000 275,000 Building and other depreciable assets 1,500,000 1,600,000 Accumulated depreciation (200,000) (216,000) Land 900,000 900,000 Other assets 250,000 270,000 Total assets $5,145,000 $5,548,000 Liabilities and Shareholders Equity Accounts payable $ 250,000 $ 220,000 Other current liabilities 125,000 120,000 Mortgage 800,000 790,000 Other liabilities 200,000 162,000 Capital stock 600,000 600,000 Retained earnings 3,170,000 3,656,000 Total liabilities and shareholders equity $5,145,000 $5,548,000

Include:

Form 1120 with all Schedules included in the PDF file (Schedules J, K, L, M-1, and M-2) Form 1120, Schedule D Form 1120, Schedule 1125-A Form 1120, Schedule 1125-E Form 1120, Schedule G Form 4562 Form 4797