Comprehensive Tax Return Problem. Jose (SSN 150-45-6789) and Rosanna (SSN 123-45-7890) Martinez are a married couple who reside at 1234 University Drive in Coral Gables, FL 33146. They have two children: Carmen, age 19 (SSN 234-65-4321), and Greg, age 10 (SSN 234-65-5432). Carmen is a full-time student at the local university; she lives at home and commutes to school. Jose is an architect for Deco Design Architects and is covered by his employer's defined benefit pension plan. His Form W-2 reported the following information: Wages $65,000 Social Security wages 65,000 Medicare wages 65,000 Federal income tax withheld Social Security tax withheld Medicare tax withheld $6,100.00 4,030.00 942.50 Rosanna was a loan officer at BankOne until October. Her Form W-2 reported the following information: Wages $43,000 Social Security wages 43,000 Federal income tax withheld Social Security tax withheld $3,000.00 Medicare wages 43,000 Medicare tax withheld 2,666.00 623.50 Rosanna's employer does not provide any retirement plan for its employees. Jose and Rosanna received $3,500 of interest income from BankOne and $130 of qualified dividend income on Microserf stock (reported in boxes la and 1b on Form 1099-DIV). Rosanna received $45 in jury duty pay in May. The Martinez family has medical insurance that they purchase through the cafeteria plan offered by Jose's employer (on a pre-tax basis). The annual cost of this medical insurance for the entire family was $3,600. Martinez family also paid $12,300 for qualified medical expenses for which they received no insurance reimbursements. The Martinez family paid $9,400 in interest on their home mortgage acquired in 2015 with a principle balance of $300,000 (which Overnight Mortgage Company reported to them on Form 1098). The Martinez family also owns a vacation home in Breckenridge, Colorado, for which they paid $4,100 of mortgage interest (acquired in 2016 with a principal balance of $82,000). Other interest paid by Jose and Rosanna includes $1,100 for a loan on their personal automobile and $400 on credit cards. The Martinez family paid real estate taxes on their principal residence of $3,500, $2,000 of real estate taxes on their vacation home and $3,200 of sales taxes during the year. The Martinez family has the necessary documentation for the following contributions made to qualified charitable organizations: (1) Cash of $2,500 given to their church. (2) Ford stock purchased 6 years ago on March 16, at a cost of $750 was given to United Way (a qualified charitable organi- zation located at 1 Flagler St. Miami, FL 33156) on February 22 when it had a fair market value of $1,650 (the average stock price on the date of donation). 183