General Information: Each student must individually complete and submit for grading all pages of the tax return.

Prepare the 2019 Tax Return for Alice and Bruce Byrd:

Form 1040, pages 1 and 2

Schedule A

2018 Tax Return Information:

Alice J. and Bruce M. Byrd are married taxpayers who file a joint return. Their Social Security numbers are 133- 89-6789 and 111-44-1112, respectively. They live at 473 Revere Avenue, Lowell, MA 01850. Alice is the office manager for Lowell Dental Clinic. Bruce is the manager of a Super Burgers fast-food outlet. Neither Alice nor Bruce wants to designate $3 to the Presidential Election Campaign Fund.

The Byrds provide over half of the support of their two children, Cynthia (born January 25, 1995, Social Security number 245-45-6788) and Maxwell (born February 7, 1999, Social Security number 245-56-6786). Both children are full-time students and live with the Byrds. Cynthia earned $6,200 from a summer internship in 2019, and Maxwell earned $3,800 from a part-time job.

The following information is from their W-2s for 2019:

Line Description Alice Bruce 1 Wages, tips, other compensation $58,000 $62,100 2 Federal income tax withheld 4,600 5,300 3 Social Security wages 58,000 62,100 4 Social Security tax withheld 3,596 3,850 5 Medicare wages and tips 58,000 62,100 6 Medicare tax withheld 841 900 15 State Massachusetts Massachusetts 16 State wages, tips, etc. 58,000 62,100 17 State income tax withheld 2,950 3,100 The Byrds had the following expenses relating to their personal residence during 2019: Property taxes $5,000 Qualified interest on home mortgage (acquisition indebtedness, reported on Form 1098) 8,700 Repairs to roof 5,750 Utilities 4,100 Fire and theft insurance 1,900 The Byrds had the following unreimbursed medical expenses for 2019: Medical insurance premiums $4,500 Over the counter medicine 700 Operation for Alice 8,500 Prescription medicines for Alice 900 Hospital expenses for Alice 3,500

During 2019, Alice and Bruce attended a dinner dance sponsored by the Lowell Police Disability Association (a qualified charitable organization). The Byrds paid $300 for the tickets. The cost of comparable entertainment would normally be $50.

The Byrds contributed $5,000 to Lowell Presbyterian Church and gave used clothing (cost of $1,200 and fair market value of $350) to the Salvation Army. All donations are supported by receipts, and the clothing is in very good condition.

Via a crowdfunding site (gofundme), Alice and Bruce made a gift to a needy family who lost their home in a fire ($400). In addition, they made several cash gifts to homeless individuals downtown (estimated to be $65).

Alices employer requires that all employees wear uniforms to work. During 2019, Alice spent $850 on new uniforms and $566 on laundry charges.

The Byrds do not keep the receipts for the sales taxes they paid and had no major purchases subject to sales tax.

HINTS:

1. Determine the optimum filing status for Alice and Bruce.

2. Determine if the children are dependents.

3. Determine if any expense items are not deductible.

4. Round all numbers to the nearest whole number no pennies.

5. If a refund is due to them, they would like it directly deposited to their bank account, Chase Bank: routing number, 044000029, account number 124897

6. If payment is due, no penalty needs to be calculated.