Assume the taxpayer does NOT wish to contribute to the Presidential Election Fund, unless otherwise stated in the problem. In addition, the taxpayers did NOT receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency during the year.

John and Shannon O'Banion, who live at 3222 Pinon Drive, Mesa, CO 81643, file as married filing jointly. John's social security number is 412-34-5670 (date of birth 5/12/1983), and Shannons is 412-34-5671 (date of birth 11/3/1985). Johns W-2 contained the following information:

Wages (box 1) = $ 66,346.74 Federal W/H (box 2) = $ 5,224.75 Social security wages (box 3) = $ 66,346.74 Social security W/H (box 4) = $ 4,113.50 Medicare wages (box 5) = $ 66,346.74 Medicare W/H (box 6) = $ 962.03 Shannon did not work for the year due to a medical condition but did receive unemployment compensation of $5,328 for the year with federal withholding of $654.68.

In the same year, they had the following medical costs:

Shannons prescribed diabetes medication $ 4,250

Shannons hospital charges 9,350

Shannons regular physician visits 835

Shannons eye doctor 75

Shannons diabetes blood testing supplies 685

Insurance reimbursements 1,925

In addition, they had the following other expenses:

State income taxes $ 4,950

Real estate property taxes 4,170

Car loan interest 500

Personal property taxes 765

Cash charitable contributions (made ratably throughout the year to their church) 2,135

Mortgage interest expense 9,970

Union dues for John 575

Tax preparation fees 175

Prepare a Form 1040 and Schedule A for the O'Banions using any appropriate worksheets. (List the names of the taxpayers in the order in which they appear in the problem. Input all the values as positive numbers.) Use the appropriate Tax Tables.