Comprehensive Problems 6 Richard McCarthy (born 2/14/64; Social Security number 100- 10-9090) and Christine McCarthy (born 6/1/1966; Social security number 101-21-3434) have a 19-year-old son (born 10/2/99 Social Security number 555-55-1212), Jack who is a full-time student at the University of Key West. The McCarthys also have a 12-year-old daughter (Social Security number 444- 23-1212), Justine, that lives with them. Richard is the CEO at a national paper company. His 2018 Form W-2: 100-10.9090 ola file OMB No 1545.600 FAST U e Wages, tp comp 230,000.00 r omet 66,000.00 Employer identification 32.5656567 einployer's name, address, and 2P code Mufflin-Dunder Paper 302 Lackawanna Ave. Scranton, PA 18503 128,400.00 5 Medicare wages and tips 230,000.00 7 Soci sony po 7,960.80 Medicare tax wiivad 3,605.00 cdps Control be 9 Varification code 1 Dupandort caro bonus played wine and stane 11 Nonqualified plans Richard McCarthy 32 Sleepy Hollow Rd. Clarks Summit, PA 18411 Employee' s ZIP code o PAL 1234834 11 230,000.00 17Saincont 13,800.00 Det of the round R ice Fan W-2 Ware and Tax 2018 Copy B-To Be Fried with Employee's FEDERAL Tax Rutum This infomation is bang tumited to the internal Revenue Service Christine is an optometrist and operates her own practice ("The Eyes of March") in town as a sole proprietor. The shop address is 1030 Morgan Highway, Clarks Summit, PA 18411 and the business code is 621320. Christine keeps her books on the accrual basis and her bookkeeper provided the following information: Gross sales $270,000 Returns 9,000 Inventory Beginning inventory S 24,000 Purchases 120,000 Ending inventory 30,000 24,000 Rent Insurance 11.000 Professional fees Payroll 3,000 37,000 2.800 Payroll taxes Utilities Office expenses 2,000 5,000 Depreciation The McCarthys have a nanny/housekeeper they paid $12,000 during 2018. They did not withhold income or FICA taxes. The McCarthys paid Pennsylvania state unemployment tax of S378 in 2018. Christine received a 2018 Form 1099-INT from the National Bank of Scranton that listed interest income of $23,400. Note that McCarthys reasonably allocate $1,278 to state income tax expense for purposes of the Net Investment Income tax. The McCarthys paid the following in 2018: Home mortgage interest S15,600 Property taxes 5,600 Estimated state income tax payments 3.000 Estimated Federal income tax payments 11,000 Charitable contributions (all cash) 7,600 Required: Complete the McCarthys' federal tax return for 2018. Use Form 1040. Schedule 1. Schedule 4. Schedule A. Schedule B. Schedule C, Schedule H. Schedule SE, Form 8959, and Form 8960 to complete this tax return. Make realistic assumptions about any missing data and ignore any alternative minimum tax. Do not complete Form 4952, which is used for depreciation. Comprehensive Problems 6 Richard McCarthy (born 2/14/64; Social Security number 100- 10-9090) and Christine McCarthy (born 6/1/1966; Social security number 101-21-3434) have a 19-year-old son (born 10/2/99 Social Security number 555-55-1212), Jack who is a full-time student at the University of Key West. The McCarthys also have a 12-year-old daughter (Social Security number 444- 23-1212), Justine, that lives with them. Richard is the CEO at a national paper company. His 2018 Form W-2: 100-10.9090 ola file OMB No 1545.600 FAST U e Wages, tp comp 230,000.00 r omet 66,000.00 Employer identification 32.5656567 einployer's name, address, and 2P code Mufflin-Dunder Paper 302 Lackawanna Ave. Scranton, PA 18503 128,400.00 5 Medicare wages and tips 230,000.00 7 Soci sony po 7,960.80 Medicare tax wiivad 3,605.00 cdps Control be 9 Varification code 1 Dupandort caro bonus played wine and stane 11 Nonqualified plans Richard McCarthy 32 Sleepy Hollow Rd. Clarks Summit, PA 18411 Employee' s ZIP code o PAL 1234834 11 230,000.00 17Saincont 13,800.00 Det of the round R ice Fan W-2 Ware and Tax 2018 Copy B-To Be Fried with Employee's FEDERAL Tax Rutum This infomation is bang tumited to the internal Revenue Service Christine is an optometrist and operates her own practice ("The Eyes of March") in town as a sole proprietor. The shop address is 1030 Morgan Highway, Clarks Summit, PA 18411 and the business code is 621320. Christine keeps her books on the accrual basis and her bookkeeper provided the following information: Gross sales $270,000 Returns 9,000 Inventory Beginning inventory S 24,000 Purchases 120,000 Ending inventory 30,000 24,000 Rent Insurance 11.000 Professional fees Payroll 3,000 37,000 2.800 Payroll taxes Utilities Office expenses 2,000 5,000 Depreciation The McCarthys have a nanny/housekeeper they paid $12,000 during 2018. They did not withhold income or FICA taxes. The McCarthys paid Pennsylvania state unemployment tax of S378 in 2018. Christine received a 2018 Form 1099-INT from the National Bank of Scranton that listed interest income of $23,400. Note that McCarthys reasonably allocate $1,278 to state income tax expense for purposes of the Net Investment Income tax. The McCarthys paid the following in 2018: Home mortgage interest S15,600 Property taxes 5,600 Estimated state income tax payments 3.000 Estimated Federal income tax payments 11,000 Charitable contributions (all cash) 7,600 Required: Complete the McCarthys' federal tax return for 2018. Use Form 1040. Schedule 1. Schedule 4. Schedule A. Schedule B. Schedule C, Schedule H. Schedule SE, Form 8959, and Form 8960 to complete this tax return. Make realistic assumptions about any missing data and ignore any alternative minimum tax. Do not complete Form 4952, which is used for depreciation