Federal Tax Return Problem (100 points) Sam Jones (age 51) is a single taxpayer and he lives at 1244 Forest Dr., Nashville, TN 37217. His Social Security number is 555-94-9358. Sam's earnings and withholding as the manager of a local business for 2015 are: W-2 earnings from the Lucky Ace Company Federal income tax withheld State income tax withheld $ 75,000 9,500 Sam's other income includes interest on a savings account at First Tennessee Bank: $120 Sam pays his ex-wife $1,400 per month. When their 10 year-old child (in the wife's custody) reaches 18, the payments are reduced to $800 per month. His ex-wife's Social Security number is 554-44-5555. Per the divorce decree, Sam's ex-wife is entitled to claim their son as a dependent in 2015. Sam will make the maximum deductible IRA contribution allowed for 2015 (as he is not covered by a pension plan at his work). During the year, Sam paid the following amounts (all of which can be substantiated): Home mortgage interest Credit card interest Auto Insurance Property taxes on personal residence State and local sales taxes actually paid during 2015 Income tax preparation fee (Schedule C: $400) Charitable contributions: (has required receipts) $ 9,000 1,760 900 2,000 4,250 825 Boy Scouts of America St. Edward Church Mexican Red Cross 800 4,000 100 In his spare time, Sam runs a management consulting business as a sole proprietor. During 2015 he incurred the following income and expenses: (Business started January 1, 2011) Consulting income S 17.500 Internet service fees Office supplies Business telephone Meals and Entertainment $ 1,800 875 1,600 960 625 135 600 2,700 400 Taxes and Licenses Advertising Office Rental Answering Service Page -2