Donald T. and Dianne W. Duncan

are married and have lived together at 910 Riverline Drive, Your City,

Your State - Your Zip, for several years lived with them all year.their total wage is $93500 from w-2

They had the following expenses:

Medical insurance $5,954 Contact lens $ 200

St. Mary's Hospital 3,000 Cancer Society 100

Eyeglasses 250 Church 1,500

American Heart Fund 100 Mortgage interest 4,536

United Way 125 Dr. Rowe 825

Real estate tax 856 Professional Dues (Dianne) 475

Dr. Myers 850 Dr. Powell 250

Personal property tax 243 Tax preparation fee 245

Medical miles 745 miles Dr. Bennett 1,254

They gave clothes and assorted miscellaneous items to the Salvation Army. The items were

purchased on various dates for a total of $1,200. They donated them on August 30, at which time

the consignment value was $650.

They itemized last year and received a state refund of $359.

Dianne was required to use her car to call on clients. She placed the car in service on 8/1/2009.

She had 14,000 total miles of which 3,000 were commuting and 6,855 were business. Dianne

keeps written records of all of her business miles. Dianne paid for and attended two sales seminars.

She was not reimbursed by her employer for the sales seminars. One cost $195 and the other cost

$149. One required her to fly to Cincinnati, where she had the following expenses:

Airline $395

Hotel 188

Meals 50

Rental car 155

Parking 15

On October 20th, Dianne sold a house she had inherited from her mother on December 15, 2006

(her mother's date of death). The house had been her parent's personal residence, which they had

purchased on May 28, 1968 for $16,000. The house was valued at $75,000 on the date of death.

The sales price was $103,000, and the expenses of sale were $7,425.

In order for Dianne to sell

the house she had to make the following improvements:

New roof $15,425 Remodel master bath $2,515

Gutters 1,512 Privacy fence 800

New carpet 2,689 Landscaping 326

Remodel kitchen 3,233

Dianne also inherited $40,000 and 100 shares of Apple stock valued at $10.80 per share at the

date of death.

Donald used his car to commute to work. His total mileage was 18,000 miles of which 3,500 were

commuting. He paid tolls to and from work totaling $675 for the year.

In his spare time, Donald began to sell wooden toys at flea markets and mall shows. He started

this business on January 28th. His income from sales of toys was $11,235.

His expenses include:

Toys purchased $2,563 Display shelves 198

Exhibit space 300 Professional publication 80

Supplies (bags, boxes, etc.) 150 Banner for exhibit 65

Meals (out of town) 270 Hotels 675

Mileage to shows 10,186

His beginning inventory was $0 and his ending inventory was $380.

Donald's accounting method is cash and his method used to value inventory is cost. Donald stored

the toys, supplies and other items related to the business in a storage facility. The cost of the

storage facility is $75 per month. His lease began in February.

The entire household was covered by health insurance all year.