Determine the federal income tax for 2018 for the Deans filing jointly using the appropriate forms. HELP!

mprehensive Tax Return Problems 1. Lance H and Wanda B. Dean are married and live at 431 Yucca Drive, Santa Fe, NM 87501. Lance works for the convention bureau of the local Chamber of Commerce, while Wanda is employed part-time as a paralegal for a law firm. During 2018, the Deans had the following receipts Salaries ($60,000 for Lance, $41,000 for Wanda) Interest income- $101,000 City of Albuquerque general purpose bonds $1,000 1,100 400 Ford Motor Company bonds Ally Bank certificate of deposit Child support payments from John Allen Annual gifts from parents Settlement from Roadrunner Touring Company Lottery winnings Federal income tax refund (for tax year 2017) 2.500 7,200 26,000 90,000 600 400 Wanda was previously married to John Allen. When they divorced several years ago, Wanda was awarded custody of their two children, Penny and Kyle. (Note: Wanda has never issued a Form 8332 waiver) Under the divorce decree, John was obli- gated to pay alimony and child suppost-the alimony payments were to terminate if Wanda remarried In July, while going to lunch in downtown Santa Fe, Wanda was injured by a tour bus. As the driver was clearly at fault, the owner of the bus, Roadrunner Tour- ing Company, paid her medical expenses (including a one-week stay in a hospital). To avoid a lawsuit, Roadrunner also transferred $90,000 to her in settlement of the personal injuries she sustained The Deans had the following expenditures for 2018: Medical expenses (not covered by insurance) Taxes 57.200 Property taxes on personal residence $3,600 State of New Mexico income tax (includes amount withheld from wages during 2018) 4200 7,800 6,000 3,600 1,200 5.000 300 Interest on home mortgage (First National Bank) Charitable contributions Life insurance premiums (policy on Lances life) Contribution to traditional IRA (on Wanda's behalf) Traffic fines Contribution to the reelection campaign fund of the mayor of Santa Fe Funeral expenses for Wayne Boye 500 6.300 The life insurance policy was taken out by Lance several years ago and designates Wanda as the beneficiary. As a part-time employee, Wanda is excluded from cover- age under her employer's pension plan. Consequently, she provides for her own retirement with a traditional IRA obtained at a local trust company. Because the r is a member of the local Chamber of Commerce, Lance felt compelled to make the political contribution CHAPTER 9 Indviduals as the Taxpayer The Deans'household includes the following, for whom they provide more than half of the support Social Security Number 123-45-6786 12345-6787 123-45-6788 123-45-6789 23-45-6785 Birth Date 12/16/1976 a/0a/1978 60/1999 Lance Dean (age 42) Wanda Dean (age 40) Penny Allen (age 19) Kyle Allen (age 16) Wayne Boyle (age 75) 06/15/1943 "in interest of piacy ad to protect agenst tapner identication misuse, Social Securty number, wed roughout the sextbook have been replaced with fctnious number Penny graduated from high school on May 9, 2018, and is undecided about college During 2018, she earned $8,500 (placed in a savings account) playing a harp in the lobby of a local hotel. Wayne is Wanda's widower father, who died on January 20 2018. For the past few years, Wayne qualified as a dependent of the Deans Federal income tax withheld is $4,200 (Gance) and $2,100 (Wanda). The proper amount of Social Security and Medicare tax was withheld Determine the Federal income tax for 2018 for the Deans on a joint retum by completing the appropriate forms. They do not want to contribute to the Presidential Election Campaign Fund. All members of the family had health care coverage for all 2018. If an overpayment results, it is to be refunded to them. Suggested software H&R BLOCK Tax Software. 2. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2016. He lives at 4680 Tax Return Problem Dogwood Lane, Springficld, MO 65801. He is employed as a paralegal by a local law Deci firm. During 2018, he had the following receipts Communications 580,000 Interest income- Money market account at Omni Bank 5 300 Savings account at Boone State Bank City of Springfield general purpose bonds Inheritance from Daniel Life insurance proceeds Amount from sale of St. Louis lot Proceeds from estate sale Federal income tax refund [for 2017 tax overpayment 60,000 200.000 80,000 9000 700 Logan inherited securities worth $60,000 from his uncle, Daniel, who died in 2018 Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2013, for $85,000 and held as an investment. As the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5, 2018, for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died Logan's expenditures for 2018 include the following Medical expenses (nclading 510,500 for dental 511,500 State of Missourl income tax (ncludes withholdings during 2018) 54,200 Property taxes on personal residence Interest on home mortgage Contribution to church (pald pledges for 2018 and 2019) Logan and his dependents are covered by his employer's health insurance policy for all of 2018. However, he is subject to a deductible, and dental care is not included The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed 4.5008,700 5,600 4,800 mprehensive Tax Return Problems 1. Lance H and Wanda B. Dean are married and live at 431 Yucca Drive, Santa Fe, NM 87501. Lance works for the convention bureau of the local Chamber of Commerce, while Wanda is employed part-time as a paralegal for a law firm. During 2018, the Deans had the following receipts Salaries ($60,000 for Lance, $41,000 for Wanda) Interest income- $101,000 City of Albuquerque general purpose bonds $1,000 1,100 400 Ford Motor Company bonds Ally Bank certificate of deposit Child support payments from John Allen Annual gifts from parents Settlement from Roadrunner Touring Company Lottery winnings Federal income tax refund (for tax year 2017) 2.500 7,200 26,000 90,000 600 400 Wanda was previously married to John Allen. When they divorced several years ago, Wanda was awarded custody of their two children, Penny and Kyle. (Note: Wanda has never issued a Form 8332 waiver) Under the divorce decree, John was obli- gated to pay alimony and child suppost-the alimony payments were to terminate if Wanda remarried In July, while going to lunch in downtown Santa Fe, Wanda was injured by a tour bus. As the driver was clearly at fault, the owner of the bus, Roadrunner Tour- ing Company, paid her medical expenses (including a one-week stay in a hospital). To avoid a lawsuit, Roadrunner also transferred $90,000 to her in settlement of the personal injuries she sustained The Deans had the following expenditures for 2018: Medical expenses (not covered by insurance) Taxes 57.200 Property taxes on personal residence $3,600 State of New Mexico income tax (includes amount withheld from wages during 2018) 4200 7,800 6,000 3,600 1,200 5.000 300 Interest on home mortgage (First National Bank) Charitable contributions Life insurance premiums (policy on Lances life) Contribution to traditional IRA (on Wanda's behalf) Traffic fines Contribution to the reelection campaign fund of the mayor of Santa Fe Funeral expenses for Wayne Boye 500 6.300 The life insurance policy was taken out by Lance several years ago and designates Wanda as the beneficiary. As a part-time employee, Wanda is excluded from cover- age under her employer's pension plan. Consequently, she provides for her own retirement with a traditional IRA obtained at a local trust company. Because the r is a member of the local Chamber of Commerce, Lance felt compelled to make the political contribution CHAPTER 9 Indviduals as the Taxpayer The Deans'household includes the following, for whom they provide more than half of the support Social Security Number 123-45-6786 12345-6787 123-45-6788 123-45-6789 23-45-6785 Birth Date 12/16/1976 a/0a/1978 60/1999 Lance Dean (age 42) Wanda Dean (age 40) Penny Allen (age 19) Kyle Allen (age 16) Wayne Boyle (age 75) 06/15/1943 "in interest of piacy ad to protect agenst tapner identication misuse, Social Securty number, wed roughout the sextbook have been replaced with fctnious number Penny graduated from high school on May 9, 2018, and is undecided about college During 2018, she earned $8,500 (placed in a savings account) playing a harp in the lobby of a local hotel. Wayne is Wanda's widower father, who died on January 20 2018. For the past few years, Wayne qualified as a dependent of the Deans Federal income tax withheld is $4,200 (Gance) and $2,100 (Wanda). The proper amount of Social Security and Medicare tax was withheld Determine the Federal income tax for 2018 for the Deans on a joint retum by completing the appropriate forms. They do not want to contribute to the Presidential Election Campaign Fund. All members of the family had health care coverage for all 2018. If an overpayment results, it is to be refunded to them. Suggested software H&R BLOCK Tax Software. 2. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2016. He lives at 4680 Tax Return Problem Dogwood Lane, Springficld, MO 65801. He is employed as a paralegal by a local law Deci firm. During 2018, he had the following receipts Communications 580,000 Interest income- Money market account at Omni Bank 5 300 Savings account at Boone State Bank City of Springfield general purpose bonds Inheritance from Daniel Life insurance proceeds Amount from sale of St. Louis lot Proceeds from estate sale Federal income tax refund [for 2017 tax overpayment 60,000 200.000 80,000 9000 700 Logan inherited securities worth $60,000 from his uncle, Daniel, who died in 2018 Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2013, for $85,000 and held as an investment. As the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5, 2018, for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died Logan's expenditures for 2018 include the following Medical expenses (nclading 510,500 for dental 511,500 State of Missourl income tax (ncludes withholdings during 2018) 54,200 Property taxes on personal residence Interest on home mortgage Contribution to church (pald pledges for 2018 and 2019) Logan and his dependents are covered by his employer's health insurance policy for all of 2018. However, he is subject to a deductible, and dental care is not included The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed 4.5008,700 5,600 4,800