Client: Vera (\& Jack) Hamifton - Lakeside Oasis Gifts Schedule: Property, plant and equipment Date: December 31, 2021 Additional notes: [1] No Section 179 election or bonus depreciation on assets purchased before 2021 [2] Maximize deduction for 2021 asset addition [3] "Shelving" asset was sold on October 30, 2021. Client: Vera (8. Jack) Hamifton Lakeside Oasis Gifts Schedule: Cash disbursements Date: December 31,2021 CLIENT TAX INFORMATION: "Lucky" Jack Hamilton comes to your office and asks you to prepare his 2021 federal income tax return. He provides you with the following information: Jack (SS\# 111-00-9999) and Vera (SS\# 111-99-8888) Hamilton are married and file a joint income tax return. Their address is 91000 Granny White Pike, Nashville, TN, 37204. Jack is employed as a tour guide, and Vera operates a small, unincorporated shop selling lake souvenirs and supplies "Lakeside Oasis Gifts" (EIN 59-8884567, Business Identification Code 453220). She rents a small business space at 123 Mallard Parkway, Nashville, TN 37204. 1. Jack and Vera have a nine year-old son, Chance (SS\# 111-99-2222), and they provide 100% of his support. Chance attends Samson Public Elementary School. 9. During the vear, the Hamiltons sold the following capital assets: Note: None of these assets were owned through the business. Note 2 : The Big Time stock was sold to Vera's sister. Note: The sailboat was used for personal recreation only. Note 4 None of the above transactions were reported on Form 10998 2. Jack's 2021 W-2 received from his employer is included in the tax information he gives to you. He also included additional tax forms he received. The following documents are available on Canvas/Projects/Project 1/Additional Client Info.pdf: - Jack's W-2 - 1099-INT from NSB Savings Bank - 1099-INT from State of TN Water District (municipal bonds) - 1099-DIV from South Corporation (a C-Corporation) stock Vera's business generated gross receipts of $199,600 in 2021. During 2021, she wrote checks for $128,460 related to her business. Vera uses the cash method of accounting and she keeps a separate bank account for her business. An Excel spreadsheet containing a detailed list of Vera's expenditures (and a template for computing tax depreciation) is available on Canvas/Projects/Project 1/Project 1 Business Info and Tax Depreciation.pdf. 4. Vera began her Lakeside Oasis Gifts business in 2018 and purchased several assets during that year. She did not elect Section 179 expensing (and she elected out of bonus depreciation) at that time because her business was just beginning (with little cash inflow) and her accountant advised her that it would be better to stretch out the deductions over the depreciable lives of the assets. The assets are used 100% for business and have been depreciated using MACRS. The assets are listed on the tax depreciation schedule on Canvas/Projects/Project 1/Project 1 Business Info and Tax Depreciation.pdf. 5. In July 2021, Vera purchased display cases for Lakeside Oasis Gifts for $15,000. She paid $1,500 down and financed the balance. She has been making payments of $620/ month since July 2021 . Of the total payments made during 2021,$340 was for interest. 6. Additional business-related information: - Vera received $500 on October 30,2021 , from the sale of old shelving, which was purchased in March 2018. 7. The Hamiltons' itemized deductions totaled $22,100 for 2021 (do not prepare Schedule A). 8. Jack's Aunt Doris gives each of her favorite nieces and nephews $1,000 every year. Jack receives $1,000 as a gift from Aunt Doris in December 2021. 1. The best way to approach the project may be to complete it in the following order: - Depreciation expense (Form 4562, after completing the excel spreadsheet) - Profit and loss from the business (Schedule C), - Self-employment tax (Schedule SE) - Capital gains \& losses (Form 8949 and Schedule D) - Finally, carry over the information from Schedules C, D, and SE to Form 1040 and Schedules 1 3 , along with any other information that needs to be reported on form 1040. 2. Assume the computer equipment is located at Vera's place of business (i.e., NOT listed property): 3. For this assignment (and this assignment onlyl), report the gain or loss on the sale of the "Shelving" asset on Schedule C as "other income" (line 6) or "other expenses" (line 27a) as appropriate. 4. Ignore Part IV on Schedule C. 5. Enter $1,000,000 on line 11 of Part I on Form 4562. Ignore page 2 of Form 4562. 6. Neither Jack nor Vera elects to contribute to the Presidential Election Campaign 7. Vera has a beginning and ending inventory of $10,000 in her business. 8. Use the Tax Tables and the qualified dividend and capital gain worksheet (both available on Canvas) to determine the tax liability. 9. Assume the Hamiltons have full health insurance coverage for the entire year through Jack's employer. 10. The Hamiltons do not have a foreign address. They do not want to allow another person to discuss their return with the IRS. 11. You are not required to calculate AMT or any tax credits for this project. 12. In addition, I am available as the client (Jack and Vera Hamilton) and as a "consultant" for questions remaining after your group has thoroughly reviewed the entire assignment. Client: Vera (\& Jack) Hamifton - Lakeside Oasis Gifts Schedule: Property, plant and equipment Date: December 31, 2021 Additional notes: [1] No Section 179 election or bonus depreciation on assets purchased before 2021 [2] Maximize deduction for 2021 asset addition [3] "Shelving" asset was sold on October 30, 2021. Client: Vera (8. Jack) Hamifton Lakeside Oasis Gifts Schedule: Cash disbursements Date: December 31,2021 CLIENT TAX INFORMATION: "Lucky" Jack Hamilton comes to your office and asks you to prepare his 2021 federal income tax return. He provides you with the following information: Jack (SS\# 111-00-9999) and Vera (SS\# 111-99-8888) Hamilton are married and file a joint income tax return. Their address is 91000 Granny White Pike, Nashville, TN, 37204. Jack is employed as a tour guide, and Vera operates a small, unincorporated shop selling lake souvenirs and supplies "Lakeside Oasis Gifts" (EIN 59-8884567, Business Identification Code 453220). She rents a small business space at 123 Mallard Parkway, Nashville, TN 37204. 1. Jack and Vera have a nine year-old son, Chance (SS\# 111-99-2222), and they provide 100% of his support. Chance attends Samson Public Elementary School. 9. During the vear, the Hamiltons sold the following capital assets: Note: None of these assets were owned through the business. Note 2 : The Big Time stock was sold to Vera's sister. Note: The sailboat was used for personal recreation only. Note 4 None of the above transactions were reported on Form 10998 2. Jack's 2021 W-2 received from his employer is included in the tax information he gives to you. He also included additional tax forms he received. The following documents are available on Canvas/Projects/Project 1/Additional Client Info.pdf: - Jack's W-2 - 1099-INT from NSB Savings Bank - 1099-INT from State of TN Water District (municipal bonds) - 1099-DIV from South Corporation (a C-Corporation) stock Vera's business generated gross receipts of $199,600 in 2021. During 2021, she wrote checks for $128,460 related to her business. Vera uses the cash method of accounting and she keeps a separate bank account for her business. An Excel spreadsheet containing a detailed list of Vera's expenditures (and a template for computing tax depreciation) is available on Canvas/Projects/Project 1/Project 1 Business Info and Tax Depreciation.pdf. 4. Vera began her Lakeside Oasis Gifts business in 2018 and purchased several assets during that year. She did not elect Section 179 expensing (and she elected out of bonus depreciation) at that time because her business was just beginning (with little cash inflow) and her accountant advised her that it would be better to stretch out the deductions over the depreciable lives of the assets. The assets are used 100% for business and have been depreciated using MACRS. The assets are listed on the tax depreciation schedule on Canvas/Projects/Project 1/Project 1 Business Info and Tax Depreciation.pdf. 5. In July 2021, Vera purchased display cases for Lakeside Oasis Gifts for $15,000. She paid $1,500 down and financed the balance. She has been making payments of $620/ month since July 2021 . Of the total payments made during 2021,$340 was for interest. 6. Additional business-related information: - Vera received $500 on October 30,2021 , from the sale of old shelving, which was purchased in March 2018. 7. The Hamiltons' itemized deductions totaled $22,100 for 2021 (do not prepare Schedule A). 8. Jack's Aunt Doris gives each of her favorite nieces and nephews $1,000 every year. Jack receives $1,000 as a gift from Aunt Doris in December 2021. 1. The best way to approach the project may be to complete it in the following order: - Depreciation expense (Form 4562, after completing the excel spreadsheet) - Profit and loss from the business (Schedule C), - Self-employment tax (Schedule SE) - Capital gains \& losses (Form 8949 and Schedule D) - Finally, carry over the information from Schedules C, D, and SE to Form 1040 and Schedules 1 3 , along with any other information that needs to be reported on form 1040. 2. Assume the computer equipment is located at Vera's place of business (i.e., NOT listed property): 3. For this assignment (and this assignment onlyl), report the gain or loss on the sale of the "Shelving" asset on Schedule C as "other income" (line 6) or "other expenses" (line 27a) as appropriate. 4. Ignore Part IV on Schedule C. 5. Enter $1,000,000 on line 11 of Part I on Form 4562. Ignore page 2 of Form 4562. 6. Neither Jack nor Vera elects to contribute to the Presidential Election Campaign 7. Vera has a beginning and ending inventory of $10,000 in her business. 8. Use the Tax Tables and the qualified dividend and capital gain worksheet (both available on Canvas) to determine the tax liability. 9. Assume the Hamiltons have full health insurance coverage for the entire year through Jack's employer. 10. The Hamiltons do not have a foreign address. They do not want to allow another person to discuss their return with the IRS. 11. You are not required to calculate AMT or any tax credits for this project. 12. In addition, I am available as the client (Jack and Vera Hamilton) and as a "consultant" for questions remaining after your group has thoroughly reviewed the entire assignment