Facts 1. Phillip and Claire are married and file a joint return. Phillip is self-employed as a real estate agent, and Claire is a flight attendant. Phillip and Claire have three dependent children. All three children live at home with Phillip and Claire for the entire year The Dunphys provide you with the following additional information: The Dunphys do not want to contribute to the presidential election campaign. The Dunphys live at 3701 Brighton Avenue, Los Angeles, California 90018 Phillip's birthday is 11/5/1969 and his Social Security number is 321-44-5766. Claire's birthday is 5/12/1972 and her Social Security number is 567-77-1258 Haley's birthday is 11/6/2003 and her Social Security number is 621-18-7592. Alex's birthday is 2/1/2005 and her Social Security number is 621-92-8751 Luke's birthday is 12/12/2009 and his Social Security number is 621-99-9926. The Dunphys do not have any foreign bank accounts or trusts 2. Claire is a flight attendant for Western American Airlines (WAA), where she earned $57,000 in salary WAA withheld federal income tax of $6,375, state income tax of $1,800, Los Angeles city income tax of $675, Social Security tax of $3,600, and Medicare tax of $825. 3. Phillip and Claire received $300 of interest from State Savings Bank on a joint account. They also received a qualified dividend of $395 on jointly owned stock in Xila Corporation 4. Phillip's full-time real estate business is named "Phillip Dunphy Realty." His business is located at 645 Grove Street, Los Angeles, California 90018, and his employer identification number is 93-3488888. Phillip's gross receipts during the year were $730,000. Phillip uses the cash method of accounting for his business. Phillip's business expenses are as follows: Advertising 5,000 Professional dues 800 Professional journals 200 Employee wages 48,000 Insurance on office contents 1,120 Accounting services 2,100 Miscellaneous office expense 500 Utilities and telephone 3,360 Payroll taxes 3,600 Depreciation To be calculated On March 20, Phillip moved his business out of the old offices at 1103 Allium Lane into a newly constructed and equipped office on Grove Street. Phillip sold the old office building and all its furnishings. Phillip's expenditures for the new office building are as follows Date Acquired Asset Cost 3/20 Land 300,000 2,500,000 3/20 Office building 200,000 3/20 Furniture Computer system 350,000 Artwork 150,000