Answered step by step
Verified Expert Solution
Question
1 Approved Answer
calculate gross income, AGI, taxable income, income tax liability, self-employment tax, any applicable credits, and final tax due/refund amount for the current year using the
calculate gross income, AGI, taxable income, income tax liability, self-employment tax, any applicable credits, and final tax due/refund amount for the current year using the individual income tax formula. Do not calculate AMT.
Also fill a 1040 form
Josh and Megan Reed are married and have two children under 13 years old that qualify as their dependents. Josh is a self-employed landscape architect-he rents office space downtown and does not work from home. Josh earned $200,000 of revenue and incurred $100,000 of deductible business expenses (you can report all of these as "other expenses" on Schedule C). Megan is a nurse earning a taxable salary of $64,800. During the year the couple received $1,600 in reimbursements from their medical plan and another $2,200 of investment income (all qualified dividends). The Reed's gambling winnings for the year were $1,000. They provided you with the following data on their expenditures for the year: Health Insurance Premiums (Josh) $2,000 Child care expenses 5,000 ($2,500 per child) Automobile insurance 1,450 Homeowners' insurance 625 Disability insurance (Megan) 375 Hospital 3,500 Doctor 2,275 Chiropractor 650 Dentists 1,750 Prescription drugs 275 Cosmetic surgery (elective) 6,000 Over-the-counter drugs 460 Federal taxes withheld (Megan's job) 11,000 State taxes withheld (Megan's job) 3,745 Investment interest expense 2,600 (assume no Form 4952 required) Mortgage interest (primary residence) 6,8504 Real estate taxes (primary residence) 2,2404 Charitable contribution (cash) 8,435 Charitable contribution (clothes, FMV)_1004 Tax return preparation 900 (assume all personal, not business) Gambling losses 1,650 Union dues (Megan's job) 310 Nurse's uniform (Megan's job) 225 Federal Estimated Tax Payments (Josh) 12,500 State Estimated Tax Payments (Josh) 5,000 Josh and Megan Reed are married and have two children under 13 years old that qualify as their dependents. Josh is a self-employed landscape architect-he rents office space downtown and does not work from home. Josh earned $200,000 of revenue and incurred $100,000 of deductible business expenses (you can report all of these as "other expenses" on Schedule C). Megan is a nurse earning a taxable salary of $64,800. During the year the couple received $1,600 in reimbursements from their medical plan and another $2,200 of investment income (all qualified dividends). The Reed's gambling winnings for the year were $1,000. They provided you with the following data on their expenditures for the year: Health Insurance Premiums (Josh) $2,000 Child care expenses 5,000 ($2,500 per child) Automobile insurance 1,450 Homeowners' insurance 625 Disability insurance (Megan) 375 Hospital 3,500 Doctor 2,275 Chiropractor 650 Dentists 1,750 Prescription drugs 275 Cosmetic surgery (elective) 6,000 Over-the-counter drugs 460 Federal taxes withheld (Megan's job) 11,000 State taxes withheld (Megan's job) 3,745 Investment interest expense 2,600 (assume no Form 4952 required) Mortgage interest (primary residence) 6,8504 Real estate taxes (primary residence) 2,2404 Charitable contribution (cash) 8,435 Charitable contribution (clothes, FMV)_1004 Tax return preparation 900 (assume all personal, not business) Gambling losses 1,650 Union dues (Megan's job) 310 Nurse's uniform (Megan's job) 225 Federal Estimated Tax Payments (Josh) 12,500 State Estimated Tax Payments (Josh) 5,000Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started