Devon Bishop, age $45,$ is single. He lives at $1507$ Rose Lane, Albuquerque, NM $87131.$ His Social Security number is $111-11-1117.$ Devon did not engage in any digital asset transactions during the year, and he does not want $$3$ to go to the Presidential Election Campaign Fund.

Devon's wife, Ariane, passed away in $2018.$ Devon's son, Tom, who is age $18,$ resides with Devon. Tom's Social Security number is $123-45-6788.$

Devon owns a sole proprietorship for which he uses the accrual method of accounting and maintains no inventory; the business operates as Devon$$s Copy Shop, $422$ E$.$ Main Street, Albuquerque, NM $87131,$ IRS business activity code: $459990.$ His revenues and expenses for $2022$ are as follows.

Sales revenue $$740,000$

Cost of goods sold $($based on purchases for the year$)405,000$

Salary expense $88,000$

Rent expense $30,000$

Utilities $8,000$

Telephone $6,500$

Advertising $4,000$

Bad debts $5,000$

Depreciation$*21,000$

Health insurance$**26,000$

Accounting and legal fees $7,000$

Supplies $1,000$

$*$New office equipment $($$$21,000)$; Devon chose to use the immediate expense election.

$**$Other income received by Devon includes the following $$18,000$ for employees and $$8,000$ for Devon.

Other income received by Devon includes the following.

Dividend income $($qualified dividends$)$:

Swan, Inc. $$10,000$

Wren, Inc. $2,000$

Interest income:

First National Bank $11,000$

Second City Bank $2,500$

County of Santa Fe$,$ NM bonds $17,000$

During the year, Devon and his sole proprietorship were involved in the following property transactions. Stock transactions were reported to Devon on Form $1099$B; basis was not reported to the IRS.

Sold Blue, Inc. stock for $$45,000$ on March $12,2022.$ He had purchased the stock on September $5,2019,$ for $$50,000.$

Received an inheritance of $$300,000$ from his uncle, Henry. Devon used $$200,000$ to purchase Green, Inc. stock on May $15,2022,$ and invested $$100,000$ in Gold, Inc. stock on May $30,2022.$

Received Orange, Inc. stock worth $$9,500$ as a gift from his aunt, Jane, on June $17,2022.$ Her adjusted basis for the stock was $$5,000.$ No gift taxes were paid on the transfer. Jane had purchased the stock on April $1,2016.$ Devon sold the stock on July $1,2022,$ for $$22,000.$

On July $15,2022,$ Devon sold one$-$half of the Green, Inc. stock for $$40,000.$

Devon was notified on August $1,2022,$ that Yellow, Inc. stock he purchased from a colleague on September $1,2021,$ for $$52,500$ had become worthless. Although he understood that investing in Yellow was risky, Devon did not anticipate that the corporation would declare bankruptcy.

On August $15,2022,$ Devon received a parcel of land in Phoenix worth $$220,000$ in exchange for a parcel of land he owned in Tucson. Because the Tucson parcel was worth $$245,000,$ he also received $$25,000$ cash. Devon's adjusted basis for the Tucson parcel was $$210,000.$ He originally purchased it on September $18,2019.$

On December $1,2022-,$ Devon sold the condominium in which he had been living for the past $20$ years $(1844$ Lighthouse Lane, Albuquerque, NM $87131)$ and moved into a rented townhouse. The sales price was $$480,000,$ selling expenses were $$28,500,$ and repair expenses related to the sale were $$9,400.$ Devon purchased the condominium for $$180,000.$

Devon's potential itemized deductions, exclusive of the previous information, are as follows.

Medical expenses $($before the $7\mathrm{.}5\%-$of$-$AGI floor$)$ $$9,500$

Property taxes on residence $5,800$

State income taxes $4,000$

Charitable contributions $10,000$

Mortgage interest on residence $($First National Bank$)9,900$

Sales taxes paid $5,000$

During the year, Devon makes estimated Federal income tax payments of $$35,000.$

Required:

Compute Devon's Federal income tax payable or refund due for $2022($assuming that he makes any available elections that will reduce the tax$),$ and complete his tax return using appropriate forms and schedules and the Qualified Dividends and Capital Gain Tax Worksheet.

form $1040$

schedule $8812$

form $8995$

form $8824$

form $4562$

qualified dividends and capital gain tax worksheet

$2022$ tax rate schedules

schedule $12$ A B C D SE

Form $8949$