Demarco and Janine Jackson have been married for 20 years and have four children (no children under age 6 at year-end) who qualify as their dependents (Damarcus, Jasmine, Michael, and Candice). The couple received salary income of $101,900 and qualified business income of $10,000 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $238,000 and they sold it for $345,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,400 of itemized deductions (no charitable contributions), and they had $1,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice.
Demarco and Janine Jackson's address is 19010 N.W. 135th Street, Miami, FL 33054.
Social security numbers:
Demarco: 123-45-6789 Janine: 234-56-7890
Son: Damarcus: 345-67-8901 Daughter: Jasmine : 456-78-9012
Son: Michael : 567-89-0123 Daughter: Candice: 678-90-1234
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a. What is the Jacksons' taxable income, and what is their tax liability or (refund)? (Do not round Intermediate calculations.) Description Amount (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction (5) ltemized deductions (7) Deduction for qualified business income (8) Total deductions from AGI (9) Taxable income (10) Income tax liability (11) Other taxes (12) Tatal tax (13) Credits (14) Prepayments Form 1040 for a couple Married Filing Jointly with four dependents. 1040 PG 1 1040 PG 2 Schedule 1 Form 1040 Page 1 and 2. Department of the Treceury Internal Revenue Service (99) Form 1040 U.S. Individual Income Tax Return 2020 OMB No 1545-0074 IRS Use Only Do not write or staple in this space Filling Status Single Mamed fing jointly Married Wing separately (MFS) Head of household (HOH) Olying widower) (w) Check only If you checked the MFS box, enter the name of your spouse. If you checked the HOH Or Ow box, enter the child's name the qualifying person is one box a child but not your dependent. Your first name and middle initial Last name Your coolal Geourity number I joint ratum, spouse's first name and middle initial Last name Spouca'c coolal cecurity number Home address number and streets. If you have a PO box, soe instructions Apt. no. Presidential Election Campaign City, town, or post office. If you have a foreign address, also complete spaces below. State ZIP code Check here it you or your spouse it filing jointly, want 53 to go to this fund. Checking a box below will not change your tax or refund 55555 Foreign postal code Formign country name Foreign province state county You apouca At any time during 2020, did you receive, sell, send exchange, or otherwise acquire any financial interest in any virtual currency? Standard Someone can claim You as a dependent Your spouse As a dependent Deduction Spouse itemizes on a separate return or you were a dual-status alien Ago Blindness You: Were bom before January 2, 1956 Are bind Spouse: Was born before January 2, 1956 Is blind Dependents see instructions: (2) Social security number (3) Relationship to you (41 if qualities for instructions: (1) First name Last name Child tax crede Credit for other dependents more than four dependents, so instructions and check horn 1 Wages, salaries, ups, etc. Altach Fom(s) W-2 Attach Sch. Bit 2a Thx-empt interest 2a Taxable interest required. 3a Qualified Monds 3a b Ordinary dividends. 30 4a IRA distributions 4a b Taxable amount sa Pensions and annuities Sa Taxable amount 50 Sa Social security benefits sa bTaxable amount 7 Capital gain or loss). Attach Schedule D if required. Standard & Other income from Schedule 1. in 9 Deduction for Single or Married Addines 1, 2, 3, 4, 6, 7and 2. This is your total income 0 ting separately $12,400 10 Adjustments to income: - Married ning jointly or using widown 100 From Schedule 1. in 22 $24.900 - Head of Charitable contributions if you take the standard deduction See instructions household $18,650 Add lines 10 and 10h. These are your total adjustments to income 100 - If you checked any box under 11 Subtract line 10c from line 9. This is your adjusted gross income 11 Standard Deduction 12 Standard caduction or itemized deductions from Schedule A) 12 son instructions 13 Oualified business income deduction.Atach Form 8995 or Fam 8996-A 13 14 Add lines 12 and 13 14 15 Thxable income. Subtract line 14 from line 11. If zero or less enter-O- 15 For Dicolours, Privacy Act, and Paperwork Reduction Act Notice, cea caparate Instruction. Cat No. 11320B Form 1040 (2020) THIS FORM IS A SIMULATION OF AN OFFICIAL U. 2. TAX FORML IT IS NOT THE OFFICIAL FORMIT SELF. DO NOT USE THIS FORM FOR TAX FILING 8 OR FOR ANY PURPO BE OTHER THAN EDUCATIONAL 2021 1040 PG 1 1040 PG 2 Schedule 1 Form 1040 Page 1 and 2. Page 2 8814 4972 16 17 18 19 20 21 22 Form 1040 (2020) 16 Tae (se instructions. Check if any from Formis: 17 Amount from Schedule 2, line 3 18 Add lines 16 and 17 19 Child tax creditor credit for other dependents 20 Amount from Schedule a line 7 21 Add lines 19 and 20 22 Subtract line 21 from line 18. If ze or less, anter-O- 23 Other taxes, including self-employment tax from Schedule 2. ine 10 24 Add lines 22 and 22. This is your total tax 25 Federal income tax withheld from: a Fors) W2 b Formis) 1099 c Other forms instructions dAddnes 26 through 250 + If you have a cuallying 262000 estimated tax payments and amount applad from 2019 rotum. child, attach Sch. Ei 23 25a 255 250 250 25 27 28 - If you have nontaxable combat pay see instructions 29 30 31 27 Eamed income credit (EIC) 28 Additional child tax credit Attach Schedule 8812 29 American opportunity credit from Form 8863, line 8 30 Recovery rabate credit. See instructions 31 Amount from Schedule 3, line 13 22 Add lines 27 through 31. These are your total other payments and refundable credits 33 Add lines 25, 26, and 32. These are your payments 34 line 33 is more than line 24 subtract line 24 from line 33. This is the amount you overpaid 25 Amount of line 34 you want refunded to you. If Form 8888 is attached, check here Routing number d Account number 32 0 33 0 Refund 34 35a 0 Type: Checking Savings Direct deposit? See instructions 36 Amount of line 34 you want applied to your 2021 estimated tax 36 Amount You Owe 37 37 Subtract line 33 from line 24. This is the amount you owe now Note: Schedule Hand Schedule Setlers, Ine 37 may not represent all of the times you owe for 2020. Sme Schedule 3, line 122, and its instructions for details 38 Estimated tax penalty s instructions) For details on how to play SO instructions Third Party Designee | 38 Yes. Complete below No Do you want to allow another person to discuss this ratum win the IRS? Soe instructions Designon's nama Phone na. Personal identication (PIN) number Sign Here Joint return? Bee Instructions. Hoop a copy for your records Under penalties of perjury, I declare that I have examined this mom and accompanying schedules and statements, and to the best of my knowledge and belief, they are true correct and complete Declaration of preparer (other than taxpayers based on all information of which preparer has any knowledge Your signature Date it the IRS sant you an identity Your occupation Protection PIN, enter it here se inst.) Data Spouse's signature. If a joint ratum, both must sign. If the IRS at your spouse an Spouses occupation Identity Protecion PiNanter it hare se inst. Phone no Email address Preparar's signature Preparer's name Date PTIN Check Self-employed Paid Preparer Use Only Firm's nama Phone no. Firm's address Firm's EN 1040 PG 1 1040 PG 2 Schedule 1 Form 1040 Schedule 1. OMB No. 1545-0074 SCHEDULE 1 (Form 1040) Additional Income and Adjustments to Income 2020 Department of the Treasury Internal Revenue Service Names) shown on Form 1040,104D-SR or 1040-NR Attach to Form 1040 1040-SR, or 1040-NR. Go to www.ire.gov/Form1040 for Instructions and the latest Information. Attachment Sequence No. 01 Your social security number Parti 1 20 b 3 Additional Income Taxable refunds, credits, or offsets of state and local income taxes Almony received Date of original divorce or separation agreements instructions) Business income or loss). Attach Schedule Other gains or losses). Atach Form 4707 Rental real estate, royales, partnerships, corporations, trusts, etc. Attach Schedule E Farm Income arosa) Altach Schedule Unemployment compensation Other income List type and amount 4 4 6 B. 7 7 8 8 B Part II Combine lines 1 through & Enter here and on Form 1040 1040-SR or 1040-NR lines Adjustments to Income Educator expenses 10 10 11 11 12 12 13 18 14 14 16 18 18 17 Certain business expenses of reservists, performing artists, and fro-basis government officials. Altach Form 2105 Health savings account deduction. Attach Form 8889 Moving expenses for members of the Armed Forces Attach Form 3903 Deductible part of self-employment tax. Attach Schedule SE Saif-employed SEP, SIMPLE, and qualified plans Self-employed hasith insurance deduction Penalty on early withdrawal of savings Almony paid Recipient's SSN Date of original divorce or separation agreements instructions) IRA deduction Student loan interest deduction Tuition and focs deduction Altach Form 8917 17 18a 18a b 0 18 10 20 20 21 21 22 Add lines 10 through 21. These are your adjustments to income Enter here and on Form 1040 1040-SR, or 1040-NR line 102 22 For Paperwork Reduction Act Notice, cea your tax return inctruotions. Cat. No. 71478F Schedule 1 (Form 1040 2020 THIS FORM 18 A SIMULATION OF AN OFFICIAL U. 2. TAX FORML IT 18 NOT THE OFFICIAL FORMIT BELF. DO NOT USE THIS FORM FOR TAX FILING 3 OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2021 Moraw-Hill Education
