Chelsea Samson is single. She is employed as an architectural designer for Streamline Design (SD). Chelsea wanted to determine her taxable income for this year. She correctly calculated her AGI. However, she wasnt sure how to compute the rest of her taxable income. She provided the following information with hopes that you could use it to determine her taxable income.

Directions: Fill in the correct answer for each blank, by examining the possible list of Itemized deductions provided by the client. Enter the total itemized deduction for each category and then provide a total itemized deduction. Lastly determine whether the client would itemize or take the standard deduction.

Assume: AGI is 107,000, Tax year is 2019, Filing Status is Single

Medical Expenses Paid

Chelsea paid $4,680 for medical expenses for care related to a broken ankle. Also, Chelseas boyfriend, Blake, drove Chelsea (in her car) a total of 115 miles to the doctors office so she could receive care for her broken ankle.

Chelsea paid a total of $3,400 in health insurance premiums during the year (not through an exchange). SD did not reimburse any of this expense. Besides the health insurance premiums and the medical expenses for her broken ankle, Chelsea had Lasik eye surgery last year and she paid $3,000 for the surgery (she received no insurance reimbursement). She also incurred $450 of other medical expenses for the year.

Total Medical Expense Deduction Allowed = __________

Taxes Paid

SD withheld $1,800 of state income tax, $7,495 of Social Security tax, and $14,500 of federal income tax from Chelseas paychecks throughout the year.

In 2018, Chelsea was due a refund of $250 for overpaying her 2017 state taxes. On her 2017 state tax return that she filed in April 2018, she applied the overpayment toward her 2018 state tax liability. She estimated that her state tax liability for 2018 will be $2,300.

Chelsea paid $3,200 of property taxes on her personal residence. She also paid $500 to the developer of her subdivision, because he had to replace the sidewalk in certain areas of the subdivision.

Chelsea paid a $200 property tax based on the states estimate of the value of her car.

Total Taxes Paid Deduction Allowed: ____________

Interest Paid

Chelsea has a home mortgage loan in the amount of $220,000 that she secured when she purchased her home. The home is worth about $400,000. Chelsea paid interest of $12,300 on the loan this year.

Total Interest Paid Deduction Allowed:___________

Charitable Contributions Made Chelsea made several charitable contributions throughout the year. She contributed stock in ZYX Corp. to the Red Cross. On the date of the contribution, the fair market value of the donated shares was $1,000 and her basis in the shares was $400. Chelsea originally bought the ZYX Corp. stock in 2008. Chelsea also contributed $300 cash to State University and religious artifacts she has held for several years to her church. The artifacts were valued at $500 and Chelseas basis in the items was $300. Chelsea had every reason to believe the church would keep them on display indefinitely. Chelsea also drove 200 miles doing church-related errands for her minister. Finally, Chelsea contributed $1,200 of services to her church last year.

Total Charitable Contributions Deduction Allowed: __________

Other Expenses Paid

Chelsea paid $250 in investment advisory fees and another $150 to have her tax return prepared (that is, she paid $150 in 2018 to have her 2017 tax return prepared).

Chelsea is involved in horse racing as a hobby. During the year, she won $2,500 in prize money and incurred $10,000 in expenses. She has never had a profitable year with her horse-racing activities, so she acknowledges that this is a hobby for federal income tax purposes.

Chelsea sustained $2,000 in gambling losses over the year (mostly horse-racing bets) and had only $200 in winnings.

Total Other Itemized Deductions Allowed: _____________

Total Itemized Deductions:______________

Should Chelsea Itemize (enter A) or take the Standard Deduction (enter B): _______

What is Chelsea's Taxable Income (enter with no $ sign but use , ex. 20,000): ________