Facts:

Armando Z. and Lourdes K. Gonzales are married and file a joint return. Armando is self-employed as a dentist, and Lourdes is a college professor. The Gonzaleses provide you with the following additional information:

• The Gonzaleses do not want to contribute to the presidential election campaign.
• The Gonzaleses live at 621 Franklin Avenue, Cincinnati, Ohio 45211.
• Armandos birthday is 3/5/1970 and his Social Security number is 333-45-6666.
• Lourdess birthday is 4/24/1972 and her Social Security number is 566-77-8888.
• The Gonzaleses do not have any foreign bank accounts or trusts.

Note: Demographic information goes on the top of each page of the tax return (1/2 of your grade for the graded tax problem is completion fill out the top of each form with the names and social security numbers as it requests).

1. Lourdes is a part-time lecturer at Xavier University in Cincinnati, where she earned $20,000. The university withheld federal income tax of $2,375, state income tax of $500, $1,240 of Social Security tax, and $290 of Medicare tax. She also worked part of the year for Delta Airlines. Delta paid her $17,000 in salary, and withheld federal income tax of $2,125, state income tax of $500, Social Security tax of $1,054, and Medicare tax of $247.
2. Armando practices under the name Armando Z. Gonzales, DDS. His business is located at 645 West Avenue, Cincinnati, Ohio 45211, and his employer identification number is 01-2222222. Armandos gross receipts during the year were $158,000. He did not receive any Form 1099s, and he did not have a requirement to file any Form 1099s for any payee. Armando uses the cash method of accounting for his business. Armandos business expenses are as follows:

Advertising	$ 2,200
Professional dues	450
Professional journals	350
Contributions to employee benefit plans	2,000
Malpractice insurance	3,200
Insurance on office contents	710
Interest on money borrowed to refurbish office	600
Accounting services	4,100
Miscellaneous office expense	488
Office rent	12,000
Dental supplies	7,672
Utilities and telephone	5,360
Wages	60,000
Payroll taxes	2,400
Assume he does not qualify for QBI deduction.

3. Lourdess mother, Maria, died on July 2, 2017, leaving Lourdes her entire estate. Included in the estate was Marias residence (325 Oak Street, Cincinnati, Ohio 45211). Marias basis in the residence was $30,000. The fair market value of the residence on July 2, 2017, was $155,000. The Gonzaleses have held the property as rental property and have managed it themselves. From July 30, 2017 until June 30, 2022, they rented the house to the same tenant. The tenant was transferred to a branch office in California and moved out at the end of June. Since they did not want to bother finding a new tenant, Armando and Lourdes sold the house on June 30, 2022. They received $140,017 for the house and land ($15,000 for the land and $125,017 for the house), less a $500 commission charged by the broker. They had depreciated the house using the MACRS rules and conventions applicable to residential real estate. To compute depreciation on the house, the Gonzaleses had allocated $15,000 of the propertys basis to the land on which the house is located. The Gonzaleses collected rent of $1,800 a month during the six months the house was occupied during the year. You may assume that the rental activity is considered an investment activity (not a trade or business). They incurred the following related expenses during this period:

Property taxes	3,800
Maintenance	465
Depreciation (I am giving you this number)	2,333

The Gonzaleses did not buy, sell, exchange, or otherwise dispose of any financial interest in any virtual currency.