Beth R. Jordan lives at 2322 Skyview Road, Mesa, AZ 85201. She is a tax accountant with Mesa Manufacturing Company, 1203 Western Avenue, Mesa, AZ 85201 (employer identification number 11-1111111). She also writes computer software programs for tax practitioners and has a part-time tax practice. Beth is single and has no dependents. Beth was born on July 4, 1972, and her Social Security number is 123-45-6789. She wants to contribute $3 to the Presidential Election Campaign Fund. The following information is shown on Beth's 2016 Wage and Tax Statement (Form W2).

Line Description Amount 1 Wages, tips, other compensation $ 65,000.00

2 Federal income tax withheld 10,500.00

3 Social Security wages 65,000.00

4 Social Security tax withheld 4,030.00

5 Medicare wages and tips 65,000.00

6 Medicare tax withheld 942.50

15 State Arizona

16 State wages, tips, etc. 65,000.00

17 State income tax withheld 1,954.00

Other 2016 transactions include the following. Beth received interest of $1,300 from Arizona Federal Savings and Loan and $400 from Arizona State Bank. Each financial institution reported the interest income on a Form 1099INT. She received qualified dividends of $800 from Blue Corporation, $750 from Green Corporation, and $650 from Orange Corporation. Each corporation reported Beth's dividend payments on a Form 1099DIV.

Beth received a $1,100 income tax refund from the state of Arizona on April 29, 2016. On her 2015 Federal income tax return, she reported total itemized deductions of $8,200, which included $2,200 of state income tax withheld by her employer.

Fees earned from her part-time tax practice totaled $3,800. She paid $600 to have the tax returns processed by a computerized tax return service.

On February 8, Beth bought 500 shares of Gray Corporation common stock for $17.60 a share. On September 12, Beth sold the stock for $14 a share.

Beth bought a used sport utility vehicle for $6,000 on June 5. She purchased the vehicle from her brother-in-law, who was unemployed and was in need of cash. On November 2, she sold the vehicle to a friend for $6,500.

On January 2, Beth acquired 100 shares of Blue Corporation common stock for $30 a share. She sold the stock on December 19 for $55 a share.

Beth records revenues of $16,000 from the sale of a software program she developed. Beth incurred the following expenditures in connection with her software development business.

Cost of personal computer (100% business use) $7,000

Cost of printer (100% business use) 2,000

Furniture 3,000

Supplies 650

Fee paid to computer consultant 3,500

Beth elected to deduct the maximum portion of the cost of the computer, printer, and furniture allowed under the provisions of 179. These items were placed in service on January 15 and used 100 percent in her business.

Although her employer suggested that Beth attend a convention on current developments in corporate taxation, Beth was not reimbursed for the travel expenses of $1,420 she incurred in attending the conference. The $1,420 included $200 for meals.

Beth paid $300 for prescription medicines and $2,875 in physician and hospital bills. Medical insurance premiums were paid by her employer. Beth paid real property taxes of $1,766 on her home. Interest on her home mortgage at Valley National Bank was $3,845, and interest paid to credit card companies totaled $320. Beth contributed $2,080 to various qualified charities during the year. Professional dues and subscriptions totaled $350.

Beth paid $1,000 in estimated Federal income taxes throughout the year. She was covered for the entire year by Mesa Manufacturing's health insurance policy.

OMB No. 1545-0074 2018 SCHEDULE SE (Form 1040) Self-Employment Tax Department of the Treasury Go to www.irs.gov/ScheduleSE for instructions and the latest information Internal Revenue Service 1991 Attach to Form 1040 or Form 1040NR. Name of person with self-employment income (as shown on Form 1040 or Form 1040NR) Social security number of person with self-employment income Attachment Sequence No 17 Before you begin: To determine if you must file Schedule SE, see the instructions. May I Use Short Schedule SE or Must I Use Long Schedule SE? Note: Use this flowchart only if you must file Schedule SE. If unsure, see Who Must File Schedule SE in the instructions. Did you receive wages or tips in 2018? Yes Are you a minister, member of a religious order, or Christian Science practitioner who received IRS approval not to be taxed on earnings from these sources, but you owe self-employment tax on other earnings? Was the total of your wages and tips subject to social security or railroad retirement (tier 1) tax plus your net earnings from self-employment more than $128,400? Yes Are you using one of the optional methods to figure your net Yes earings (see instructions)? Did you receive tips subject to social security or Medicare tax that you didn't report to your employer? Did you receive church employee income (see instructions) Yes reported on Form W-2 of $108.2B or more? Did you report any wages on Form 8919, Uncollected Social Yes Security and Medicare Tax on Wages? No You may use Short Schedule SE below You must use Long Schedule SE on page 2 Section A-Short Schedule SE. Caution: Read above to see if you can use Short Schedule SE. 1a 2 1a Net farm profit or loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A. . . . . . . . . . . . . . . . . . . ... . . b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code AH 2 Net profit or loss) from Schedule C, line 31; Schedule C-Ez, line 3; Schedule K-1 (Form 1065) box 14, code A (other than farming): and Schedule K-1 (Form 1065-B), box 9, code Ministers and members of religious orders, see instructions for types of income to report on this line. See instructions for other income to report . . . . . . . . . . . . . Combine lines 1a, 1b, and 2 . . . . . . . . . . . . . . . . . . . . Multiply line 3 by 92.35% (0.9235). If less than $400, you don't owe self-employment tax, det file this schedule unless you have an amount on line 1b. . . . Note: If line 4 is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions. Self-employment tax. If the amount on line 4 is: $128,400 or less, multiply line 4 by 15.3% (0.153). Enter the result here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55 . More than $128,400, multiply line 4 by 2.9% (0.029). Then, add $15,921.60 to the result. Enter the total here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55. Deduction for one-half of self-employment tax. Multiply line 5 by 50% (0.50). Enter the result here and Schedule 1 (Form 1040), line 27, or Form 1040NR, line 27 For Paperwork Reduction Act Notice, see your tax return instructions. 5 Schedule SE (Form 1040) 2018 OMB No. 1545-0074 2018 SCHEDULE SE (Form 1040) Self-Employment Tax Department of the Treasury Go to www.irs.gov/ScheduleSE for instructions and the latest information Internal Revenue Service 1991 Attach to Form 1040 or Form 1040NR. Name of person with self-employment income (as shown on Form 1040 or Form 1040NR) Social security number of person with self-employment income Attachment Sequence No 17 Before you begin: To determine if you must file Schedule SE, see the instructions. May I Use Short Schedule SE or Must I Use Long Schedule SE? Note: Use this flowchart only if you must file Schedule SE. If unsure, see Who Must File Schedule SE in the instructions. Did you receive wages or tips in 2018? Yes Are you a minister, member of a religious order, or Christian Science practitioner who received IRS approval not to be taxed on earnings from these sources, but you owe self-employment tax on other earnings? Was the total of your wages and tips subject to social security or railroad retirement (tier 1) tax plus your net earnings from self-employment more than $128,400? Yes Are you using one of the optional methods to figure your net Yes earings (see instructions)? Did you receive tips subject to social security or Medicare tax that you didn't report to your employer? Did you receive church employee income (see instructions) Yes reported on Form W-2 of $108.2B or more? Did you report any wages on Form 8919, Uncollected Social Yes Security and Medicare Tax on Wages? No You may use Short Schedule SE below You must use Long Schedule SE on page 2 Section A-Short Schedule SE. Caution: Read above to see if you can use Short Schedule SE. 1a 2 1a Net farm profit or loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A. . . . . . . . . . . . . . . . . . . ... . . b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code AH 2 Net profit or loss) from Schedule C, line 31; Schedule C-Ez, line 3; Schedule K-1 (Form 1065) box 14, code A (other than farming): and Schedule K-1 (Form 1065-B), box 9, code Ministers and members of religious orders, see instructions for types of income to report on this line. See instructions for other income to report . . . . . . . . . . . . . Combine lines 1a, 1b, and 2 . . . . . . . . . . . . . . . . . . . . Multiply line 3 by 92.35% (0.9235). If less than $400, you don't owe self-employment tax, det file this schedule unless you have an amount on line 1b. . . . Note: If line 4 is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions. Self-employment tax. If the amount on line 4 is: $128,400 or less, multiply line 4 by 15.3% (0.153). Enter the result here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55 . More than $128,400, multiply line 4 by 2.9% (0.029). Then, add $15,921.60 to the result. Enter the total here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55. Deduction for one-half of self-employment tax. Multiply line 5 by 50% (0.50). Enter the result here and Schedule 1 (Form 1040), line 27, or Form 1040NR, line 27 For Paperwork Reduction Act Notice, see your tax return instructions. 5 Schedule SE (Form 1040) 2018