Comprehensive Problem 9-1

Dr. Carol Harris, CPA, is a single taxpayer and she lives at 674 Yankee Street, Durham, NC 27409. Her Social Security number is 793-52-4335 and her birthdate is July 1, 1968. Carol is an Associate Professor of Accounting at a local college. Carol's earnings and withholding from the college for 2016 are:

Earnings $54,600 Federal income tax withheld 7,800 State income tax withheld 2,650 FICA tax of $3,385.20 and Medicare tax of $791.70 were also withheld from Carol?s earnings. Carol's other income includes interest of $167 from a savings account at Bank of the Carolinas and $485 of qualified dividends from Microsoft.

Carol received a 2016 Form 1099-G from the state of North Carolina reporting a state income tax refund of $127 from 2015. Carol itemized her deductions in 2015.

During the year, Carol paid the following amounts (all of which can be substantiated):

Home mortgage interest $6,410 Visa card interest 350 Auto insurance 750 Property taxes on personal residence 2,700 Other medical expenses 810 Charitable contributions (in cash) 967 Actual state sales tax 872 Carol had the following stock market transactions, all of which were reported on Form 1099-B, along with the basis of the stock sold:

Stock Acquired Sold Price Basis Hammerhead Inc. 04/05/09 10/15/16 $5,900 $3,200 Leopard Corp. 02/01/16 08/03/16 $7,000 $5,400 Sand Corp. 09/12/11 10/15/16 $7,100 $8,500 In addition to being a professor at the local college, Carol maintains a CPA practice located at 700 Accounting Way, Durham, NC 27409. Income and expenses from this activity are:

Fees from CPA practice (all paid by check) $40,200 Office rent 4,150 Supplies 750 Computer tax service 1,200 Mileage (4,726 miles) 2,552 Client meals and entertainment (total cost) 2,960 Telephone 975 Other Expenses 1,400 Carol drove her car (placed in service on January 1, 2014) 20,000 miles in total, of which 5,000 miles were for commuting. Carol made 2016 estimated tax payments to the U.S. Treasury of $3,000 for each quarter.

Required:

Complete Carol's federal tax return for 2016. Use Form 1040, Schedule A, Schedule C, Schedule D, Form 8949, page 1 of Schedule SE, and the Qualified Dividends and Capital Gains Tax Worksheet to complete this tax return. Make realistic assumptions about any missing data.

If an amount box does not require an entry or the answer is zero, enter "0". If required, round any amount to the nearest dollar. If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers.

Click here to access the tax table to use for this problem.

Comprehensive Problem 9-1 Dr. Carol Harris, CPA, is a single taxpayer and she lives at 674 Yankee Street, Durham, NC 27409. Her Social Security number is 793-52-4335 and her birthdate is July 1, 1968. Carol is an Associate Professor of Accounting at a local college. Carol's earnings and withholding from the college for 2016 are: Earnings $54,600 Federal income tax withheld 7,800 State income tax withheld 2,650 FICA tax of $3,385.20 and Medicare tax of $791.70 were also withheld from Carol's earnings. Carol's other income includes interest of $167 from a savings account at Bank of the Carolinas and $485 of qualified dividends from Microsoft. Carol received a 2016 Form 1099-G from the state of North Carolina reporting a state income tax refund of $127 from 2015. Carol itemized her deductions in 2015. During the year, Carol paid the following amounts (all of which can be substantiated): Home mortgage interest $6,410 Visa card interest 350 Auto insurance 750 Property taxes on personal residence 2,700 Other medical expenses 810 Charitable contributions (in cash) 967 Actual state sales tax 872 Carol had the following stock market transactions, all of which were reported on Form 1099-B, along with the basis of the stock sold: Stock Acquired Sold Price Basis Hammerhead Inc. 04/05/09 10/15/16 $5,900 $3,200 Leopard Corp. 02/01/16 08/03/16 $7,000 $5,400 Sand Corp. 09/12/11 10/15/16 $7,100 $8,500 In addition to being a professor at the local college, Carol maintains a CPA practice located at 700 Accounting Way, Durham, NC 27409. Income and expenses from this activity are: Fees from CPA practice (all paid by check) Office rent Supplies $40,200 4,150 750 Computer tax service 1,200 Mileage (4,726 miles) 2,552 Client meals and entertainment (total cost) 2,960 Telephone 975 Other Expenses 1,400 Carol drove her car (placed in service on January 1, 2014) 20,000 miles in total, of which 5,000 miles were for commuting. Carol made 2016 estimated tax payments to the U.S. Treasury of $3,000 for each quarter. Required: Complete Carol's federal tax return for 2016. Use Form 1040, Schedule A, Schedule C, Schedule D, Form 8949, page 1 of Schedule SE, and the Qualified Dividends and Capital Gains Tax Worksheet to complete this tax return. Make realistic assumptions about any missing data. If an amount box does not require an entry or the answer is zero, enter "0". If required, round any amount to the nearest dollar. If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers. Click here to access the tax table to use for this problem. Form Department of the TreasuryInternal Revenue Service 1040 U.S. Individual Income Tax Return (99) For the year Jan. 1-Dec. 31, 2016, or other tax year beginning Your first name and initial Carol Last name Harris If a joint return, spouse's first name and initial Last name 2016 , 2016, ending , 20 OMB No. 15450074 IRS U See separate instruc Your social security n 793-52-4335 Spouse's social securit Home address (number and street). If you have a P.O. box, see instructions. 674 Yankee Street Apt. no. Make sure the SSN(s) above and City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below (see instructions). Durham, NC 27409 Foreign country name Foreign province/state/country Presidential Election Campaign Check here if you, or your spouse if fi go to this fund. Checking a box below Foreign postal tax or refund. code You Spou Filing Status Exemptions 6a b Yourself. If someone can claim you as a dependent, do not check box 6a . . . . . . . . . . . . . . ......... Spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } Boxe check 6a an No. o (4) If child under c Dependents: (2) (3) age 17 Dependent's Dependent's qualifying social relationship for child tax security to you credit (see number First Last instructions (1) name name ) If more than four dependents, see instructions and check here d Income Total number of exemptions claimed . . . . . . . . . . . . . . . . child 6c wh live you did with due t divor separ (see instr Depe on 6c enter abov Add numb lines 7 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . . . . . . . . . . . 8a Attach Form(s) W-2 b here. Also attach Forms 9a W-2G and b 1099-R if tax was withheld. 10 Taxable interest. Attach Schedule B if required . . . . . . . . . . . . . . . . . . . . . . . . . Tax-exempt interest. Do not include on line 8a . . . . . . . . . 8b Ordinary dividends. Attach Schedule B if required . . . . . . . . . . . . . . . . . . . . . . Qualified dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9b Taxable refunds, credits, or offsets of state and local income taxes . . . . . . . . . . . If you did not 11 Alimony received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . get a W-2, see 12 Business income or (loss). Attach Schedule C or C-EZ . . . . . . . . . . . . . . . . . . . instructions. 13 Capital gain or (loss). Attach Schedule D if required. If not required, check here 14 Other gains or (losses). Attach Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IRA 15a distributions ...... 15a b Taxable amount . . . Pensions 16a and annuities 16a b Taxable amount . . . 17 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E 18 Farm income or (loss). Attach Schedule F . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Unemployment compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Social 20a security benefits 20a b Taxable amount . . . 21 Other income. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 22 Combine the amounts in the far right column for lines 7 through 21. This is your total income 23 Educator expenses . . . . . . . . . . . . . . . . . . . . . . . . . . Adjusted 24 Certain business expenses of reservists, performing artists, Gross Income and fee-basis government officials. Attach Form 2106 or 2106-EZ 23 24 25 Health savings account deduction. Attach Form 8889 . . . . . 25 26 Moving expenses. Attach Form 3903 . . . . . . . . . . . . . . . . 26 27 Deductible part of self-employment tax. Attach Schedule SE 27 28 Self-employed SEP, SIMPLE, and qualified plans . . . . . . . 28 29 Self-employed health insurance deduction . . . . . . . . . . . . . 29 30 Penalty on early withdrawal of savings . . . . . . . . . . . . . . . 30 31a Alimony paid b Recipient's SSN 31a 32 IRA deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 33 Student loan interest deduction . . . . . . . . . . . . . . . . . . . 33 34 Tuition and fees. Attach Form 8917 . . . . . . . . . . . . . . . 34 35 Domestic production activities deduction. Attach Form 8903 35 36 Add lines 23 through 35 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Subtract line 36 from line 22. This is your adjusted gross income . . . . . . . . For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 113 Form 1040 (2016) Tax and Credits Standard Deduction for People who check any box on line 39a or 39b or who can be claimed as a dependent, see instructions. All others: Single or Married filing separately, $6,300 Married filing jointly or Qualifying widow(er), $12,700 Head of household, $9,300 Other Taxes Carol Harris 793-52-4335 38 Amount from line 37 (adjusted gross income) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39a Check if: You were born before January 2, 1952, { Spouse was born before January 2, 1952, Blind. Blind. Total boxes } checked 39a b If your spouse itemizes on a separate return or you were a dual-status alien, check here 39b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Itemized deductions (from Schedule A) or your standard deduction (see left margin) 41 Subtract line 40 from line 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 42 Exemptions. If line 38 is $155,650 or less, multiply $4,050 by the number on line 6d. Otherwise, see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Taxable income. Subtract line 42 from line 41. If line 42 is more than line 41, enter -044 Tax (see instructions). Check if any from: a Form(s) 8814 b Form 4972 c 45 Alternative minimum tax (see instructions). Attach Form 6251 . . . . . . . . . . . . . . . 46 Excess advance premium tax credit repayment. Attach Form 8962 . . . . . . . . . . . . . . 47 Add lines 44, 45, and 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Foreign tax credit. Attach Form 1116 if required . . . . . 48 Credit for child and dependent care expenses. Attach Form 2441 49 50 Education credits from Form 8863, line 19 . . . . . . . . 50 Retirement savings contributions credit. Attach Form 8880 51 52 Child tax credit. Attach Schedule 8812, if required . . 52 53 Residential energy credits. Attach Form 5695 . . . . . 53 54 Other credits from Form: a 3800 54 49 51 b 8801 c 55 Add lines 48 through 54. These are your total credits . . . . . . . . . . . . . . . . . . . . . . 56 Subtract line 55 from line 47. If line 55 is more than line 47, enter -0- . . . . . . . . . . . 57 Self-employment tax. Attach Schedule SE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Unreported social security and Medicare tax from Form: a 4137 b 8919 . . . . . 59 Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required 60a Household employment taxes from Schedule H . . . . . . . . . . . . . . . . . . . . . . . . . . . . b First-time homebuyer credit repayment. Attach Form 5405 if required . . . . . . . . . . . 61 Health care: individual responsibility (see instructions) Full-year coverage 62 Taxes from: a Form 8959 b Form 8960 c Instructions; enter code(s) _ _ _ _ _ 63 Add lines 56 through 62. This is your total tax . . . . . . . . . . . . . . . . . . . . . . . . . . . Payments 64 Federal income tax withheld from Forms W-2 and 1099 . . . . . . . 65 2016 estimated tax payments and amount applied from 2015 return If you have a qualifying child, attach Schedule EIC. 66a b 65 Earned income credit (EIC) . . . . . . . . . . . . . . 66a ............ Nontaxable combat pay election . . . . 66b 67 Additional child tax credit. Attach Schedule 8812 . . . . . . . . . . . . 67 68 American opportunity credit from Form 8863, line 8 . . . . . . . . . . 68 69 Net premium tax credit. Attach Form 8962 . . . . . . . . . . . . . . . . 69 70 Amount paid with request for extension to file . . . . . . . . . . . . . . 70 71 Excess social security and tier 1 RRTA tax withheld . . . . . . . . . 71 72 Credit for federal tax on fuels. Attach Form 4136 . . . . . . . . . . 72 73 Credits from Form: a 2439 b Reserved c 8885 d 73 74 Add lines 64, 65, 66a, and 67 through 73. These are your total payments . . . . . . . . 76a Routing b number Amount of line 75 you want refunded to you. If Form 8888 is attached, check here c Type: Checking Savings Account d number 77 Amount of line 75 you want applied to your 2017 estimated tax Amount You Owe 64 75 If line 74 is more than line 63, subtract line 63 from line 74. This is the amount you overpaid Refund Direct deposit? See instructions. 77 78 Amount you owe. Subtract line 74 from line 63. For details on how to pay, see instructions 79 Estimated tax penalty (see instructions) . . . . . . . . . . . . . . . . . 79 Do you want to allow another person to discuss this return with the IRS (see instructions)? below. No Third Party Designee Designee's name Phone no. Personal identification number (PIN Under penalties of perjury, I declare that I have examined this return and accompanying sched to the best of my knowledge and belief, they are true, correct, and complete. Declaration of pre taxpayer) is based on all information of which preparer has any knowledge. Sign Here Your signature Carol Harris Joint return? See instructions. Keep a copy for your records. Spouse's signature. If a joint return, both must sign. Print/Type preparer's name Paid Preparer Use Only Date Preparer's signature Your occupation Professor Date Spouse's occupa Date Check self-emp Firm's name Firm's E Firm's address Phone n www.irs.gov/form1040 SCHEDULE A (Form 1040) Department of the Treasury Internal Revenue Service (99) Itemized Deductions Information about Schedule A and its separate instructions is at www.irs.gov/schedu Attach to Form 1040. Name(s) shown on Form 1040 Carol Harris Caution: Do not include expenses reimbursed or paid by others. Medical and Dental Expenses 1 Medical and dental expenses (see instructions) . . . . . . . . . 2 Enter amount from Form 1040, line 38 1 2 3 Multiply line 2 by 10% (0.10). But if either you or your spouse was born before January 2, 1952, multiply line 2 by 7.5% (0.075) instead 3 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- . . . . . . . . . . . . . . . . . Taxes You Paid 5 State and local (check only one box): a Income taxes, or b General Sales Taxes } ............ 5 6 Real estate taxes (see instructions) . . . . . . . . . . . . . . . 6 7 Personal property taxes . . . . . . . . . . . . . . . . . . . . . . . 7 8 Other taxes. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ __________________________________ 8 9 Add lines 5 through 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest You 10 Home mortgage interest and points reported to you on Form 1098 Paid 11 Home mortgage interest not reported to you on Form 1098. If paid to the person from whom you bought the home, see instructions and show that Note: person's name, identifying no., and address _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Your _____________ mortgage interest __________________________________ deduction 12 Points not reported to you on Form 1098. See instructions for special rules may be .................................. limited (see instructions). 13 Mortgage insurance premiums (see instructions) . . . . . . . . 14 Investment interest. Attach Form 4952 if required. (See instructions.) 10 11 12 13 14 15 Add lines 10 through 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gifts to 16 Gifts by cash or check. If you made any gift of $250 or more, Charity see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If you made a gift and got 17 Other than by cash or check. If any gift of $250 or more, see instructions. a benefit for You must attach Form 8283 if over $500 . . . . . . it, see instructions. 18 Carryover from prior year . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 18 19 Add lines 16 through 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Casualty and Theft Losses 20 Casualty or theft loss(es). Attach Form 4684. (See instructions.) . . . . . . . . . . . . Job Expenses and Certain Miscellaneous Deductions 21 Unreimbursed employee expensesjob travel, union dues, job education, etc. Attach Form 2106 or 2106-EZ if required. (See instructions.) _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 22 Tax preparation fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 22 23 Other expensesinvestment, safe deposit box, etc. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __________________________________ 24 Add lines 21 through 23 . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Enter amount from Form 1040, line 38 23 24 25 26 Multiply line 25 by 2% (0.02) . . . . . . . . . . . . . . . . . . . . . . .. 26 27 Subtract line 26 from line 24. If line 26 is more than line 24, enter -0- . . . . . . . . . . . . . Other Miscellaneous Deductions Total Itemized Deductions 28 Otherfrom list in instructions. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ____________________________________________ 29 Is Form 1040, line 38, over $155,650? No. Your deduction is not limited. Add the amounts in the far right column for lines 4 through 28. Also, enter this amount on Form 1040, line 40. Yes. Your deduction may be limited. See the Itemized Deductions Worksheet in the instructions to figure the amount to enter. 30 If you elect to itemize deductions even though they are less than your standard deduction, check here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . For Paperwork Reduction Act Notice, see Form 1040 instructions. Cat. No. 17145C } ...... Schedu SCHEDULE C (Form 1040) Department of the Treasury Internal Revenue Service (99) Profit or Loss From Business (Sole Proprietorship) Information about Schedule C and its separate instructions is at www.irs.gov/schedulec. Attach to Form 1040, 1040NR, or 1041; partnerships generally must file Form 106 Name of proprietor Carol Harris Social security n 793-52-4335 A Principal business or profession, including product or service (see instructions) Accountant B Enter code fro 541211 C Business name. If no separate business name, leave blank. Carol Harris, CPA D Employer ID n instr.) E Business address (including suite or room no.) 700 Accounting Way City, town or post office, state, and ZIP code Durham, NC 27409 F Accounting method: (1) Cash (2) Accrual (3) Other (specify) _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ G Did you "materially participate" in the operation of this business during 2016? If "No," see instructions for on losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . H If you started or acquired this business during 2016, check here . . . . . . . . . . . . . . . . . . I Did you make any payments in 2016 that would require you to file Form(s) 1099? (see instructions) . . . J If "Yes," did you or will you file required Forms 1099? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Part I 1 Income Gross receipts or sales. See instructions for line 1 and check the box if this income was reported to you on Form W-2 and the "Statutory employee" box on that form was checked . . . . . . . . . . . . . . . 2 Returns and allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Cost of goods sold (from line 42) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Gross profit. Subtract line 4 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Other income, including federal and state gasoline or fuel tax credit or refund (see instructions) . . . . . 7 Gross income. Add lines 5 and 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. Part II Expenses. Enter expenses for business use of your home only on line 30. 8 Advertising . . . . . . . . . . . . . . . 9 Car and truck expenses (see 8 18 Office expense (see instructions) 19 Pension and profit-sharing plans . . . . instructions) . . . . . . . . . . . . . 9 10 Commissions and fees . . . . . 10 a Vehicles, machinery, and equipment 11 Contract labor (see instructions) 11 b Other business property . . . . . . . . .. 12 Depletion . . . . . . . . . . . . . . . . 12 13 Depreciation and section 179 expense deduction (not included in Part III) (see instructions) . . . 13 20 21 Repairs and maintenance . . . . . . . 22 Supplies (not included in Part III) . . . 23 Taxes and licenses . . . . . . . . . . . . . 24 Travel, meals, and entertainment: 14 Employee benefit programs (other than on line 19) . . . . . . . 15 Insurance (other than health) Rent or lease (see instructions): a Travel . . . . . . . . . . . . . . . . . . . . . 14 b Deductible meals and 15 16 Interest: entertainment (see instructions) . . . . 25 Utilities . . . . . . . . . . . . . . . . . . . . . 26 Wages (less employment credits) . . . . a Mortgage (paid to banks, etc.) 16a b Other . . . . . . . . . . . . . . . . . . 16b 27a Other expenses (from line 48) . . . . . 17 b Reserved for future use . . . . . . .. 17 Legal and professional services 28 Total expenses before expenses for business use of home. Add lines 8 through 27a . . . . . . . . . . . . . . 29 Tentative profit or (loss). Subtract line 28 from line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. Expenses for business use of your home. Do not report these expenses elsewhere. Attach Form 8829 unless using the simplified method (see instructions). 30 Simplified method filers only: enter the total square footage of: (a) your home: and (b) the part of your home used for business: . Use the Simplified Method Worksheet in the instructions to figure the amount to enter on line 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Net profit or (loss). Subtract line 30 from line 29. If a profit, enter on both Form 1040, line 12 (or Form 1040NR, line 13) and on Schedule SE, line 2. (If you checked the box on line 1, see instructions). Estates and trusts, enter on Form 1041, 3. have a loss, check the box that describes your investment in this activity (see instructions). 32 line If you If you checked 32a, enter the loss on both Form 1040, line 12, (or Form 1040NR, line 13) and on Schedule SE, line 2. (If you checked the box on line 1, see the line 31 instructions). Estates and trusts, enter on Form 1041, line 3. If you checked 32b, you must attach Form 6198. Your loss may be limited. For Paperwork Reduction Act Notice, see the separate instructions. Cat. No. 11334P } } Schedu Schedule C (Form 1040) 2016 Part III Carol Harris 793-52-4335 Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: a Cost b Lower of cost or market c Other (attach explanation) 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory If "Yes," attach explanation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation . . . . . 36 Purchases less cost of items withdrawn for personal use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Cost of labor. Do not include any amounts paid to yourself. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Materials and supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Other costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Add lines 35 through 39 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Inventory at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on line 4 . . . . . . . . . Part IV Information on Your Vehicle. Complete this part only if you are claiming car or truck expenses on required to file Form 4562 for this business. See the instructions for line 13 to find out if you must fi 01/01/14 43 When did you place your vehicle in service for business purposes? (month, day, year) 44 Of the total number of miles you drove your vehicle during 2016, enter the number of miles you used your v a Business b Commuting (see instructions) c Other 45 Was your vehicle available for personal use during off-duty hours? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 Do you (or your spouse) have another vehicle available for personal use? . . . . . . . . . . . . . . . . . . . . . . . 47 Do you have evidence to support your deduction? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . a b If "Yes," is the evidence written? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. Part V Other Expenses. List below business expenses not included on lines 8-26 or line 30. 48 Total other expenses. Enter here and on line 27a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedu SCHEDULE D (Form 1040) Department of the Treasury Internal Revenue Service (99) Capital Gains and Losses Attach to Form 1040 or Form 1040NR. Information about Schedule D and its separate instructions is at www.irs.gov/scheduled. Use Form 8949 to list your transactions for lines 1b, 2, 3, 8b, 9, and 10. Name(s) shown on return Carol Harris Part I Your Short-Term Capital Gains and LossesAssets Held One Year or Less See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars. (d) Proceeds (sales price) (e) Cost (or other basis) 1a Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 1b . . . . . . . . . . . . . . . . . . . . . 1b Totals for all transactions reported on Form(s) 8949 with Box A checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Totals for all transactions reported on Form(s) 8949 with Box B checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Totals for all transactions reported on Form(s) 8949 with Box C checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 . . 5 Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 6 Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back . . . . . . . . . . . . Part II Long-Term Capital Gains and LossesAssets Held More Than One Year See instructions for how to figure the amounts to enter on the lines Adju to g loss Fo 8949 lin colu below. This form may be easier to complete if you round off cents to whole dollars. (d) Proceeds (sales price) Adju to g loss Fo 8949 lin colu (e) Cost (or other basis) 8a Totals for all long-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 8b . . . . . . . . . . . . . . . . . . . . . . . 8b Totals for all transactions reported on Form(s) 8949 with Box D checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Totals for all transactions reported on Form(s) 8949 with Box E checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Totals for all transactions reported on Form(s) 8949 with Box F checked . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Gain from Form 4797, Part I; long-term gain from Forms 2439 and 6252; and long-term gain or (loss) from Forms 4684, 6781, and 8824 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 13 Capital gain distributions. See the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Long-term capital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Net long-term capital gain or (loss). Combine lines 8a through 14 in column (h). Then go to Part III on the back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . For Paperwork Reduction Act Notice, see your tax return instructions. Schedule D (Form 1040) 2016 Part III Cat. No. 11338H Carol Harris Schedu 793-52-43 Summary 16 Combine lines 7 and 15 and enter the result . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If line 16 is a gain, enter the amount from line 16 on Form 1040, line 13, or Form 1040NR, line 14. Then to line 17 below. If line 16 is a loss, skip lines 17 through 20 below. Then go to line 21. Also be sure to complete line 22. If line 16 is zero, skip lines 17 through 21 below and enter -0- on Form 1040, line 13, or Form 1040NR, li 14. Then go to line 22. 17 Are lines 15 and 16 both gains? Yes. Go to line 18. No. Skip lines 18 through 21, and go to line 22. 18 Enter the amount, if any, from line 7 of the 28% Rate Gain Worksheet in the instructions . . . . . . . . . . 19 Enter the amount, if any, from line 18 of the Unrecaptured Section 1250 Gain Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Are lines 18 and 19 both zero or blank? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44 (or in the instructions for Form 1040NR, line 42). Don't complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions. Don't complete lines 21 and 22 below 21 If line 16 is a loss, enter here and on Form 1040, line 13, or Form 1040NR, line 14, the smaller of: ...................................... The loss } on line 16 Note: When figuring which amount is smaller, treat both amounts as positive numbers. 22 Do you have qualified dividends on Form 1040, line 9b, or Form 1040NR, line 10b? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44 (or in the instructions for Form 1040NR, line 42). No. Complete the rest of Form 1040 or Form 1040NR. Schedu Form 8949 Department of the Treasury Internal Revenue Service Name(s ) shown on return Carol Harris Sales and Other Dispositions of Capital Assets Information about Form 8949 and its separate instructions is at www.irs.gov/form894 File with your Schedule D to list your transactions for lines 1b, 2, 3, 8b, 9, and 10 of Schedule D. Social security number or taxpayer identification number 793-52-4335 Before you check Box A, B, or C below, see whether you received any Form(s) 1099-B or substitute statement(s) substitute statement will have the same information as Form 1099-B. Either will show whether your basis (usual reported to the IRS by your broker and may even tell you which box to check. Part I Short-Term. Transactions involving capital assets you held 1 year or less are short term. For long-te page Note:2.You may aggregate all short-term transactions reported on Form(s) 1099-B showing basis was and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 1a; report these transactions on Form 8949 (see instructions). You must check Box A, B, or C below. Check only one box. If more than one box applies for your short-term t separate Form 8949, page 1, for each applicable box. If you have more short-term transactions than will fit on th of the boxes, complete as many forms with the same box checked as you need. (A) Short-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note a (B) Short-term transactions reported on Form(s) 1099-B showing basis wasn't reported to the IRS (C) Short-term transactions not reported to you on Form 1099-B 1 Adjustment, if a gain or loss. If yo an amount in co (e) (g), enter a cod Cost or other column (f). See (a) (c) (d) (b) basis. See the separate instruc Description of property Date sold or Proceeds (sales Date acquired Note below and (Example: 100 sh. XYZ disposed of price) (see (f) (Mo., day, yr.) see Column (e) Co.) (Mo., day, yr.) instructions) Code(s) in the separate Am from instructions adju instructions 2 Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts). Enter each total here and include on your Schedule D, line 1b (if Box A above is checked), line 2 (if Box B above is checked), or line 3 (if Box C above is checked) Note: If you checked Box A above but the basis reported to the IRS was incorrect, enter in column (e) the basis a and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to the adjustment. For Paperwork Reduction Act Notice, see instructions. Cat. No. 37768Z Form 8949 (2016) Name(s) shown on return. Name and SSN or taxpayer identification no. not required if shown on other side Carol Harris Attachment Sequence No. 12A Social security number or taxpayer identification number 793-52-4335 Before you check Box D, E, or F below, see whether you received any Form(s) 1099-B or substitute statement(s) substitute statement will have the same information as Form 1099-B. Either will show whether your basis (usual reported to the IRS by your broker and may even tell you which box to check. Part II Long-Term. Transactions involving capital assets you held more than 1 year are long term. For sho page Note:1.You may aggregate all long-term transactions reported on Form(s) 1099-B showing basis was for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 8a; you report these transactions on Form 8949 (see instructions). You must check Box D, E, or F below. Check only one box. If more than one box applies for your long-term tr separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on thi of the boxes, complete as many forms with the same box checked as you need. (D) Long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note a (E) Long-term transactions reported on Form(s) 1099-B showing basis wasn't reported to the IRS (F) Long-term transactions not reported to you on Form 1099-B 1 Adjustment, if a gain or loss. If enter an amou column (g), en (e) Cost or other code in column ( (a) (c) (d) the separat (b) basis. See the Description of property Date sold or Proceeds (sales instruction Date acquired Note below and (Example: 100 sh. XYZ disposed of price) (see (Mo., day, yr.) see Column (e) (f) Co.) (Mo., day, yr.) instructions) in the separate Code(s) Am instructions from adju instructions 2 Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts). Enter each total here and include on your Schedule D, line 8b (if Box D above is checked), line 9 (if Box E above is checked), or line 10 (if Box F above is checked) Note: If you checked Box D above but the basis reported to the IRS was incorrect, enter in column (e) the basis and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to the adjustment. SCHEDULE SE (Form 1040) Department of the Treasury Internal Revenue Service (99) Self-Employment Tax Information about Schedule SE and its separate instructions is at www.irs.gov/schedulese. Attach to Form 1040 or Form 1040NR. Name of person with self-employment income (as shown on Social security number of person with self-emplo Form 1040 or Form 1040NR) income Carol Harris Before you begin: To determine if you must file Schedule SE, see the instructions. May I Use Short Schedule SE or Must I Use Long Schedule SE? Note: Use this flowchart only if you must file Schedule SE. If unsure, see Who Must File Schedule SE in the ins Did you receive wages or tips in 2016? No Are you a minister, member of a religious order, or Christian Science practitioner who received IRS approval not to be taxed on earnings from these sources, but you owe self-employment No Yes Are you using one of the optional methods to figure your net earnings (see instructions)? Yes Did you receive tips subject to so Medicare tax that you didn't rep employer? No Did you receive church employee income (see instructions) reported on Form W-2 of $108.28 or more? Was the total of your wages and t social security or railroad retirem plus your net earnings from self- Yes Did you report any wages on For No Uncollected Social Security and Wages? No You may use Short Schedule SE below You must use Long Sched Section AShort Schedule SE. Caution. Read above to see if you can use Short Schedule SE. 1a Net farm profit or (loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code Z . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Net profit or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and Schedule K-1 (Form 1065-B), box 9, code J1. Ministers and members of religious orders, see instructions for types of income to report on this line. See instructions for other income to report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 3 Combine lines 1a, 1b, and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Multiply line 3 by 92.35% (0.9235). If less than $400, you don't owe self-employment tax; don't file this schedule unless you have an amount on line 1b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Note: If line 4 is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions. 5 Self-employment tax. If the amount on line 4 is: $118,500 or less, multiply line 4 by 15.3% (0.153). Enter the result here and on Form 1040, line 57, or Form 1040NR, line 55 More than $118,500, multiply line 4 by 2.9% (0.029). Then, add $14,694 to the result. Enter the total here and on Form 1040, line 57, or Form 1040NR, line 55 . . . . . . . . . . . . . . . . . . . 6 Deduction for one-half of self-employment tax. Multiply line 5 by 50% (0.50). Enter the result here and on Form 1040, line 27, or Form 1040NR, line 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 11358Z Schedul Schedule SE (Form 1040) 2016 Attachment Sequence No Name of person with self-employment income (as shown on Form 1040 or Form 1040NR) Stew Social security number o with self-employment in Section BLong Schedule SE Part I Self-Employment Tax Note: If your only income subject to self-employment tax is church employee income, see instructions. Also se the definition of church employee income. A If you are a minister, member of a religious order, or Christian Science practitioner and you filed Form 436 $400 or more of other net earnings from self-employment, check here and continue with Part I.......................... 1a Net farm profit or (loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A. Note: Skip lines 1a and 1b if you use the farm optional method (see instructions). . . 1 b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code Z. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 Net profit or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and Schedule K-1 (Form 1065-B), box 9, code J1. Ministers and members of religious orders, see instructions for types of income to report on this line. See instructions for other income to report. Note: Skip this line if you use the nonfarm optional method (see instructions) . . . 3 Combine lines 1a, 1b, and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4a If line 3 is more than zero, multiply line 3 by 92.35% (0.9235). Otherwise, enter amount from line 3. . 4 Note: If line 4a is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions. b If you elect one or both of the optional methods, enter the total of lines 15 and 17 here . . . . . . . . 4 c Combine lines 4a and 4b. If less than $400, stop; you do not owe self-employment tax. Exception. If less than $400 and you had church employee income, enter -0- and continue 5a Enter your church employee income from Form W-2. See instructions for definition of church employee income. . . . . . . . . . . ............ 5a b Multiply line 5a by 92.35% (0.9235). If less than $100, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Add lines 4c and 5b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Maximum amount of combined wages and self-employment earnings subject to social security tax or the 6.2% portion of the 7.65% railroad retirement (tier 1) tax for 2016 . . . . . . . . . . . . . . . . . . . . 8a Total social security wages and tips (total of boxes 3 and 7 on Form(s) W-2) and railroad retirement (tier 1) compensation. If $118,500 or more, skip lines 8b through 10, and go to line 11 . . . . . .......... 4 8a 5 b Unreported tips subject to social security tax (from Form 4137, line 10) 8b c Wages subject to social security tax (from Form 8919, line 10). . . . . 8c d Add lines 8a, 8b, and 8c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 Subtract line 8d from line 7. If zero or less, enter -0- here and on line 10 and go to line 11 . 10 Multiply the smaller of line 6 or line 9 by 12.4% (0.124) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 11 Multiply line 6 by 2.9% (0.029) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 12 Self-employment tax. Add lines 10 and 11. Enter here and on Form 1040, line 57, or Form 1040NR, line 55 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 13 Deduction for one-half of self-employment tax. Multiply line 12 by 50% (0.50). Enter the result here and on Form 1040, line 27, or Form 1040NR, line 27 . . . . . . . . . . . . . . . . . . . . . . . . Part II 13 Optional Methods To Figure Net Earnings (see instructions) Farm Optional Method. You may use this method only if (a) your gross farm income1 was not more than $7,560, or (b) your net farm profits2 were less than $5,457 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Maximum income for optional methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 15 Enter the smaller of: two-thirds (2/3) of gross farm income (not less than zero) or $5,040. Also include this amount on line 4b above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Nonfarm Optional Method. You may use this method only if (a) your net nonfarm profits3 were less than $5,457 and also less than 72.189% of your gross nonfarm income,4 and (b) you had net earnings from selfemployment of at least $400 in 2 of the prior 3 years. Caution. You may use this method no more than five times. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Subtract line 15 from line 14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 17 Enter the smaller of: two-thirds (2/3) of gross nonfarm income4 (not less than zero) or the amount on line 16. Also include this amount on line 4b above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 From Sch. F, line 9, and Sch. K-1 (Form 1065), box 14, code B. 2 From Sch. F, line 34, and Sch. K-1 (Form 1065), box 14, code Aminus the amount you would have entered o you not used the optional method. Schedul Qualified Dividends and Capital Gain Tax WorksheetLine 44 Before you begin: See the earlier instructions for line 44 to see if you can use this worksheet to figure y Before completing this worksheet, complete Form 1040 through line 43. If you do not have to file Schedule D and you received capital gain distributions, be s on line 13 of Form 1040. 1. Enter the amount from Form 1040, line 43. However, if you are filing Form 2555 or 2555EZ (relating to foreign earned income), enter the amount from line 3 of the Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. Enter the amount from Form 1040, line 9b* . . . . . . . . . . . . . . . . . . . 1. 2. 3. Are you filing Schedule D?* Yes No Enter the smaller of line 15 or 16 of Schedule D. If either line 15 or line 16 is of blank or a loss, enter -0-. } 3. Enter the amount from Form 1040, line 13. 4. Add lines 2 and 3.................................... ..... 4. 5. If filing Form 4952 (used to figure investment interest expense deduction), enter any amount from line 4g of that form. Otherwise, enter -0- . . . . . . . . 5. 6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. 7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Enter: $37,650 if single or married filing separately, $75,300 if married filing jointly or qualifying widow(er), } ...... . 8. $50,400 if head of household. 9. Enter the smaller of line 1 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Enter the smaller of line 7 or line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. 11. Subtract line 10 from line 9. This amount is taxed at 0% . . . . . . . . . . . . . . . . . . . . . . . . . 11. 12. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12. 13. Enter the amount from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13. 14. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. 15. Enter: $415,050 if single, $233,475 if married filing separately, } .... ..... 15. $466,950 if married filing jointly or qualifying widow(er), $441,000 if head of household. 16. Enter the smaller of line 1 or line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. 17. Add lines 7 and 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. 18. Subtract line 17 from line 16. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18. 19. Enter the smaller of line 14 or line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19. 20. Multiply line 19 by 15% (0.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. Add lines 11 and 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. 22. Subtract line 21 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22. 23. Multiply line 22 by 20% (0.20) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24. Figure the tax on the amount on line 7. If the amount on line 7 is less than $100,000, use the Tax Table to fi the tax. If the amount on line 7 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . 25. Add lines 20, 23, and 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26. Figure the tax on the amount on line 1. If the amount on line 1 is less than $100,000, use the Tax Table to fi the tax. If the amount on line 1 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . 27. Tax on all taxable income. Enter the smaller of line 25 or line 26. Also include this amount on Form 1040 44. If you are filing Form 2555 or 2555-EZ, do not enter this amount on Form 1040, line 44. Instead, enter line 4 of the Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . * If you are filing Form 2555 or 2555-EZ, see the footnote in the Foreign Earned Income Tax Worksheet before