Comprehensive Problem 2-2B

Carl Conch and Mary Duval are married and file a joint return. Carl is retired US Army but likes to stay busy, and so he works as a part-time baker at the Key Lime Pie Company. Mary is unemployed since losing her job in 2021. Carl's birthdate is June 14, 1957, and Mary's is October 2, 1967. Carl received a W-2 from his employer (see separate tab).

Carl and Mary help support an old Army friend of Carls named Buster Crabbe. Buster is 72 years old and lives in an over-55 community in Key West near Carl and Marys apartment. Buster has a small Social Security benefit of $6,000 per year, and so Carl and Mary provide for more than half of his support. Busters birth date is June 12, 1950, and his Social Security number is 454-11-1719.

Carls W-2, 1099-R (Army pension), and Social Security benefits statement are presented below (see separate tab).

Mary is divorced, and she pays her ex-husband (Tom Tortuga) child support. Pursuant to their January 2019, divorce decree, Mary pays Tom $500 per month in child support. All payments were made on time in 2022.

In early 2022, when Mary was struggling financially due to the loss of her job, she was able to renegotiate her auto loan and had the balance reduced by $4,000. The Form 1099-C is presented below (see separate tab).

Sadly, in June 2022, Marys father passed away and left her $75,000.

Mary also received unemployment compensation as shown on Form 1099-G (see separate tab).

The Key Lime Pie Company provides all employees with a gym on the premises of the pie factory that Carl works at. Carl uses the gym at least three days a week. The value of a similar gym membership would be $1,200.

Required:

Complete Carl and Mary's Form 1040 and Schedule 1 for 2022. The taxpayers had health care coverage the entire year. They do not want to make a contribution to the presidential election campaign. Make any other realistic assumptions about any missing data. If an amount box does not require an entry or the amount is zero, enter "0". Enter all amounts as positive numbers. If required, round amounts to the nearest dollar.