Chapter 3-45 (Logan B. Taylor) South-Westerns Federal Taxation, Comprehensive Volume (2019)

45. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2016. He lives at 4680 Dogwood Lane, Springfield, MO 65801. He is employed as a paralegal by a local law firm. For 2018, he reported the following receipts. Salary Interest income 80,000 Money market account at Omni Bank 300 1,100 3,000 Savings account at Bosne State Bank City of Springfield general purpose bonds Inheritance from Daniel Life insurance proceeds Amount from sale of St. Louis lot Proceeds from estate sale Federal income tax refund (for 2017 tax overpayment) 4,400 60,000 200,000 80,000 9,000 700 In 2018, Logan inherited securities worth $60,000 from his deceased uncle, Daniel. Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2013, for $85,000 and held as an investment. As the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5, 2018, for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died Logan's other 2018 expenditures include the following Medical expenses (including $10,500 for dental services) Taxes 11,500 State of Missouri income tax (includes withholdings) $4,200 4,500 Property taxes on personal residence Interest on home mortgage Contribution to church (paid pledges for 2018 and 2019) 8,700 5,600 4,800 Logan and his dependents were covered by his employer's health insurance policy for all of 2018. However, he is subject to a deductible, and dental care is not included. The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed mother, who lives with him (see below). Logan normally pledges $2,400 ($200 per month) each year to his church. On December 5, 2018, upon the advice of his pastor, he prepaid his pledge for 2019 Logan's household, al of whom he supports, includes the following 45. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2016. He lives at 4680 Dogwood Lane, Springfield, MO 65801. He is employed as a paralegal by a local law firm. For 2018, he reported the following receipts. Salary Interest income 80,000 Money market account at Omni Bank 300 1,100 3,000 Savings account at Bosne State Bank City of Springfield general purpose bonds Inheritance from Daniel Life insurance proceeds Amount from sale of St. Louis lot Proceeds from estate sale Federal income tax refund (for 2017 tax overpayment) 4,400 60,000 200,000 80,000 9,000 700 In 2018, Logan inherited securities worth $60,000 from his deceased uncle, Daniel. Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2013, for $85,000 and held as an investment. As the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5, 2018, for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died Logan's other 2018 expenditures include the following Medical expenses (including $10,500 for dental services) Taxes 11,500 State of Missouri income tax (includes withholdings) $4,200 4,500 Property taxes on personal residence Interest on home mortgage Contribution to church (paid pledges for 2018 and 2019) 8,700 5,600 4,800 Logan and his dependents were covered by his employer's health insurance policy for all of 2018. However, he is subject to a deductible, and dental care is not included. The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed mother, who lives with him (see below). Logan normally pledges $2,400 ($200 per month) each year to his church. On December 5, 2018, upon the advice of his pastor, he prepaid his pledge for 2019 Logan's household, al of whom he supports, includes the following