Chris and Stefani Watanabe, married filing jointly, live with their two boys at $1400$ Victoria Lane, Riverside, CA $92501.$ Chris is an accountant who has his own accounting practice. Stefani is an elementary school teacher. Their sons, Justin and Jordan, are ages $13$ and $10,$ respectively. The following is additional information regarding the Watanabes.

Social security numbers and birthdates for the Watanabe family:

Chris $412-34-567005/23/1982$

Stefani $412-34-567110/14/1983$

Justin $412-34-567202/19/2009$

Jordan $412-34-567307/02/2012$

They paid $$4,500$ to Friendly Hills Child Care center for after$-$school care for both Justin and Jordan, allocated equally. The address is $2$ River Drive, Riverside, CA $92501$ and their ID number is $22-1234567.$

Stefani$$s W$-2$ from the Riverside school district showed the following:

Wages $=$ $ $56,925\mathrm{.}04$

Federal W$/$H $=$ $ $6,935\mathrm{.}90$

Social Security wages $=$ $ $56,925\mathrm{.}04$

Social Security W$/$H $=$ $ $3,529\mathrm{.}35$

Medicare Wages $=$ $ $56,925\mathrm{.}04$

Medicare W$/$H $=$ $ $825\mathrm{.}41$

California W$/$H $=$ $ $2,105\mathrm{.}75$

Chris's accounting business is located in downtown Riverside and his business code is $541211.$ His business had the following income and expense information $($Cash basis$)$ for the year:

Gross revenues $ $169,445$

Expenses:

Advertising $ $2,100$

Insurance $1,200$

Legal fees $10,500$

Office supplies $800$

Rent $23,855$

Travel $6,945$

Meals $2,400$

Utilities $2,800$

Wages $34,000$

Dues $650$

Additionally, Chris and Stefani paid the following expenses during the year:

Medical and dental expenses $ $4,500$

Property tax $($home on Victoria Lane$)3,750$

State income taxes with the $2021$ return $3,900$

Donations to the church $($cash$)3,500$

Mortgage interest $($home on Victoria Lane$)18,556$

Stefani paid $$950$ in classroom expenses for her class

Chris and Stefani also earned $$1,481$ of interest income from California Bank during the year.

Lastly, Chris and Stefani own a three$-$bedroom cabin in Big Bear Lake $($they bought it in January of $2010$ for $$300,000).$ The address is $3105$ Stonehedge Road, Big Bear Lake, CA $92315.$ They did not use the property for personal use at any time during the year. The revenue and expenses for the Big Bear Lake rental property are as follows:

Rental income $ $18,000$

Expenses:

Insurance $ $1,200$

Property taxes $2,500$

Auto $($standard mileage$)267$

Management fees $1,600$

Repairs and maintenance $1,100$

Mortgage interest $9,000$

Depreciation Calculate

Utilities $551$

The Watanabes also made $$11,000$ and $$9,000$ in federal and California estimated income tax payments, respectively, on $06/15/22.$

Required:

Prepare the Watanabes$$ federal tax return for $2022.$ Use Form $1040,$ Schedule A$,$ Schedule C$,$ Schedule E$,$ Schedule SE$,$ and any additional schedules or forms they may need. They do not want to contribute to the presidential election campaign, and they do not want anyone to be a third$-$party designee. Chris and Stefani have not acquired any financial interest in virtual currency last year. For any missing information, make reasonable assumptions. Use the appropriate EIC Tables $(6$A$-6$ or $6$A$-7),$ and Tax Tables or Tax Rate Schedules.