Federal Income Tax Homework Chapter 5

1.

Problem 5-15 Medical Expenses (L0 5.6) In 2019, Margaret and John Murphy (age 66 and 68, respectively) are married taxpayers who le a joint tax return with AGI of $26,100. During the year they incurred the following expenses: Medical insurance premiums $1,300 Premiums on an insurance policy that pays $100 per 400 day for each day Margaret is hospitalized Medical care lodging (two people, one night) 65 Hospital bills 2,100 Doctor bills 850 Dentist bills 200 Prescription drugs and medicines 340 Psychiatric care 350 In addition, they drove 80 miles for medical transportation, and their insurance company reimbursed them $800 for the above expenses. On the following segment of Schedule A of Form 1040, calculate the Murphy's medical expense deduction. If required, round any amount to the nearest dollar. Enter all amounts as positive numbers. Caution. Do not include expenses reimbursed or paid by others. Medical 1 Medical and dental expenses (see instructions) .............. and 2 Enter amount from Form 1040 or 1040-SR, Dental line 8b ..... Expenses 3 Multiply line 2 by 10% (.10) ............................ 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter 0 .......................... Problem 5-19 Taxes (L0 5.7) Laura is a single taxpayer living in New Jersey with adjusted gross income for the 2019 tax year of $35,550. Laura's employer withheld $3,410 in state income tax from her salary. In April of 2019, she pays $550 in additional state taxes for her prior year's tax return. The real estate taxes on her home are $1,800 for 2019, and her personal property taxes, based on the value of the property, amount to $400. Also, she paid $80 for state gasoline taxes for the year. Complete the taxes section of Schedule A below to report Laura's 2019 deduction for taxes assuming she chooses to deduct state and local income taxes. If an amount is zero, enter "0". Enter all amounts as positive numbers. Taxes You 5 State and local taxes Paid a State and local income taxes or general sales taxes. You may include either income taxes or general sales taxes on line 5a, but not both. If you elect to include general sales taxes instead of income taxes, check this box ..................... > D b State and local real estate taxes (see instructions) ........... 1: State and local personal property taxes ................... d Add lines Sa through 5c ............................. e Enter the smaller of line 5d and $10,000 ($5,000 if married ling separately) ............................ D MD 6 Other taxes. List type and amount F ______________ 7 Add lines 5e and 6 ................................... 7 S Problem 5-23 Interest (L0 5.8) Ken paid the following amounts for interest during 2019: Qualified interest on home mortgage per Form 1098 $5,322 Auto loan interest 850 "Points" on the mortgage for acquisition of his 400 personal residence per Form 1098 Service charges on his checking account 40 Masterca rd interest 300 Calculate Ken's itemized deduction for interest on the following portion of Schedule A. If a line item is zero, enter "0". Enter all amounts as positive numbers. Interest 8 Home mortgage interest and points. If you didn't use all of your home You Paid mortgage |oan(s) to buy, build, or improve your home, see instructions and check this box .................... > El Caution: a Home mortgage Interest and paints reported to you on Form 1098 See Your mortgage instructions if limited 5 C] interest b Home mortgage interest not reported to you on Form 1098. If deduction may paid to the person from whom you bought the home, see be limited (see instructions and show that person's name, identifying no., and instructions). address * __________________________ c Points not reported to you on Form 1098. See instructions for special rules .................................... d Reserved ...................................... e Add lines 8a through 8c ............................ 8e C] 9 Investment interest. Attach Form 4952 if required. See instructions. 9 10 Add lines 8e through 9 ................................................ Problem 5-28 Contributions (L0 5.9) Jerry made the following contributions during 2019: His synagogue (by check) $1,100 The Republican Party (by check) 180 The American Red Cross (by check) 200 His lodge fraternal organization for tickets to (a 100 social club) a holiday party In addition, Jerry donated used furniture to the Salvation Army costing $400 with a fair market value of $200. Jerry has adjusted gross income of $45,000, the necessary written acknowledgments, and he itemizes his deductions. Complete the Gis to Charity section of Schedule A below to show Jerry's deduction for 2019. Enter all amounts as positive numbers. Gifts to 11 Gifts by cash or check. If you made any gift of $250 or more, - Charity see instructions ................................. 11 [:] 12 Other than by cash or check. If you made any gift of $250 or more, see instructions. You must attach Form 8283 if over Caution: If you made a 12 gilt and got a $500 ..... benem for it' 13 cam/\"er from prior year. ........................ 13 see i"5\"\"Cti\"5- 14 Add lines 11 through 13 ............................................... 14 C]