gullo, u save yoursell around $300 Case Study #2 has a schedule A, for itemized deductions. Ally is a single mother, collecting alimony, and has several deductions; a schedule A is done to determine if the standard deduction is a better deduction than the itemized. If her itemized comes in less than the standard, then of course, take the standard deduction. Ally's tax return is a bit more complicated so I have condensed the parts you need to complete. You are to complete Case Study #1 by filling out the 1040 return for Jack and Jill Smith, and upload it into Drop Box. You will also fill in the blanks on the provided answer sheet for Case Study #2, Ally, Sophie and Carson Davidson. You will upload the answer page into Drop box along with the tax return 1040 for a total of 3 submitted pages to drop box, Income Tax Brackets and Rates In 2018, the income limits for all tax brackets and alfilers will be adjusted for inflation and will as follows (Tables 1 and 2). The top marginal income tax rate of 37 percent will hit taxpayers wi taxable income of $500,000 and higher for single filers and $600,000 and higher for married filing Jointly. TABLE 1 Tax Brackets and Rates, 2018 For Unmarried individuals, Rate Taxable income Over 103 $0 12% $9.525 22N $38.700 24% $82.500 32 $157,500 35X $200,000 37% $500,000 For Married Individuals Filing Joint Returns, Taxable income Over 50 $19.050 $77.400 $165.000 $315.000 $400.000 $600.000 For Heads of Househe Taxable income Ove 50 $13.600 $51 800 $82.500 $157.500 $200,000 $500 000 Standard Deduction and Personal Exemption The standard deduction for single filers will increase by $5,500 and by $11,000 for married cou filing Jointly (Table 4). The personal exemption for 2018 is eliminated. TABLE 2 2018 Standard Deduction and Personal Exemption Filing Status Deduction Amount Single $12,000 Married Filling Jointly $24,000 Head of Household $18.000 CASE STUDY 2: Ally, Sophie and Carson Davidson Ally Davidson is 38 years old and divorced. Her social security number is 888.66.4444. Her daughter, Sophie (who is 19 years old, has a SSN of 333.55.7777. Her son, Carson (who is 15 years old), has a SSN of 999 88 7777. Sophie and Carson both lived with Ally for the entire year at 2 Surfside, Seal Beach CA Ally provided more than half of Sophie and Carsons support and paid all of the cost of keeping up their home. Ally eamed $75,500 as a nurse. Federal income tax withheld from her salary was $3,700. She received $100 in interest from the Bank of America and $380 in ordinary dividends from her Apple Stock. Her ex husband paid her $20,000 in alimony and $16,000 in child support. Even though Ally received a refund from her federal taxes last year, she had to pay $460 in state income taxes. Ally's only retirement program is a hospital pension that she does not contribute to; she is given a contribution from the pension, Sophie just started college this past year and had $1,600 in qualifying expenses between the Spring and Fall semesters. Ally has listed as potential itemized deductions for this year the following I would like you to determine which of these can be used on her schedule A. Please record your answers on the answer sheet, which you will then upload into drop box Hly be dop I would like you to determine which of these can be used on her schedule A Please record your answers on the answer shoot, which you will then upload into drop box. United Calvary Church contribution $2,400 - Used clothing donated to Goodwill $250 Interest paid on a car loan $980 Interest paid on credit card bills $204 out of pocket medical expense S6,460 Home mortgage interest $7,040 . General sales tax paid $430 Personal property taxes for her car $300 . Personal property taxes for her car, $300 - Real estate taxes $1,400 Local income taxes withheld $702 Tax preparation fees $540 Ally wants a refund of any overpaid tax. Ally does not want to contribute $3 to the Presidential Election Campaign Fund. Complete Form 1040 and Schedule A and attach them to the end of this assignment. Sign the forms for Ally. Her accountant is John Winsor, Winsor Accounting Firm at 48 Junipero Ave., Long Beach CA (310 987.1234, 11. Tax preparadon leos 12. Does Ally get a tax credit for both children - Fill in the Blank 13. On Ally's 1040, what amount goes on Line 1? (wages salaries, tips) 14. Line 2b. Tax exempt interest 15. Line 3b. ordinary dividends 16. Line 6 - what other income would Ally claim? (see schedule 1) MacBook Air 17. Line 7 - what is Ally's adjusted Gross Income? Now lets look at the Schedule A Itemized Deductions 18. Line 1 for medical, dental expenses is $6460, enter the income you came up with from line 7 on the 1040, and multiply it by 7.5% to find amount that can be deducted. Were you able to enter the amount or did you enter a zero? 19. How much can Ally deduct in state and local taxes for line 5a? 20. In line 8a, how much can Ally deduct for home mortgage interest? 21. How much can Ally deduct for gifts to charity? 22. Will Ally use the itemized or standard deduction? 23. Back to the 1040, how much credit will Ally get for the child tax credit? 24. Does Ally pay tax on her alimony received? 25. Does Ally pay tax on any child support received? MacBook Air gullo, u save yoursell around $300 Case Study #2 has a schedule A, for itemized deductions. Ally is a single mother, collecting alimony, and has several deductions; a schedule A is done to determine if the standard deduction is a better deduction than the itemized. If her itemized comes in less than the standard, then of course, take the standard deduction. Ally's tax return is a bit more complicated so I have condensed the parts you need to complete. You are to complete Case Study #1 by filling out the 1040 return for Jack and Jill Smith, and upload it into Drop Box. You will also fill in the blanks on the provided answer sheet for Case Study #2, Ally, Sophie and Carson Davidson. You will upload the answer page into Drop box along with the tax return 1040 for a total of 3 submitted pages to drop box, Income Tax Brackets and Rates In 2018, the income limits for all tax brackets and alfilers will be adjusted for inflation and will as follows (Tables 1 and 2). The top marginal income tax rate of 37 percent will hit taxpayers wi taxable income of $500,000 and higher for single filers and $600,000 and higher for married filing Jointly. TABLE 1 Tax Brackets and Rates, 2018 For Unmarried individuals, Rate Taxable income Over 103 $0 12% $9.525 22N $38.700 24% $82.500 32 $157,500 35X $200,000 37% $500,000 For Married Individuals Filing Joint Returns, Taxable income Over 50 $19.050 $77.400 $165.000 $315.000 $400.000 $600.000 For Heads of Househe Taxable income Ove 50 $13.600 $51 800 $82.500 $157.500 $200,000 $500 000 Standard Deduction and Personal Exemption The standard deduction for single filers will increase by $5,500 and by $11,000 for married cou filing Jointly (Table 4). The personal exemption for 2018 is eliminated. TABLE 2 2018 Standard Deduction and Personal Exemption Filing Status Deduction Amount Single $12,000 Married Filling Jointly $24,000 Head of Household $18.000 CASE STUDY 2: Ally, Sophie and Carson Davidson Ally Davidson is 38 years old and divorced. Her social security number is 888.66.4444. Her daughter, Sophie (who is 19 years old, has a SSN of 333.55.7777. Her son, Carson (who is 15 years old), has a SSN of 999 88 7777. Sophie and Carson both lived with Ally for the entire year at 2 Surfside, Seal Beach CA Ally provided more than half of Sophie and Carsons support and paid all of the cost of keeping up their home. Ally eamed $75,500 as a nurse. Federal income tax withheld from her salary was $3,700. She received $100 in interest from the Bank of America and $380 in ordinary dividends from her Apple Stock. Her ex husband paid her $20,000 in alimony and $16,000 in child support. Even though Ally received a refund from her federal taxes last year, she had to pay $460 in state income taxes. Ally's only retirement program is a hospital pension that she does not contribute to; she is given a contribution from the pension, Sophie just started college this past year and had $1,600 in qualifying expenses between the Spring and Fall semesters. Ally has listed as potential itemized deductions for this year the following I would like you to determine which of these can be used on her schedule A. Please record your answers on the answer sheet, which you will then upload into drop box Hly be dop I would like you to determine which of these can be used on her schedule A Please record your answers on the answer shoot, which you will then upload into drop box. United Calvary Church contribution $2,400 - Used clothing donated to Goodwill $250 Interest paid on a car loan $980 Interest paid on credit card bills $204 out of pocket medical expense S6,460 Home mortgage interest $7,040 . General sales tax paid $430 Personal property taxes for her car $300 . Personal property taxes for her car, $300 - Real estate taxes $1,400 Local income taxes withheld $702 Tax preparation fees $540 Ally wants a refund of any overpaid tax. Ally does not want to contribute $3 to the Presidential Election Campaign Fund. Complete Form 1040 and Schedule A and attach them to the end of this assignment. Sign the forms for Ally. Her accountant is John Winsor, Winsor Accounting Firm at 48 Junipero Ave., Long Beach CA (310 987.1234, 11. Tax preparadon leos 12. Does Ally get a tax credit for both children - Fill in the Blank 13. On Ally's 1040, what amount goes on Line 1? (wages salaries, tips) 14. Line 2b. Tax exempt interest 15. Line 3b. ordinary dividends 16. Line 6 - what other income would Ally claim? (see schedule 1) MacBook Air 17. Line 7 - what is Ally's adjusted Gross Income? Now lets look at the Schedule A Itemized Deductions 18. Line 1 for medical, dental expenses is $6460, enter the income you came up with from line 7 on the 1040, and multiply it by 7.5% to find amount that can be deducted. Were you able to enter the amount or did you enter a zero? 19. How much can Ally deduct in state and local taxes for line 5a? 20. In line 8a, how much can Ally deduct for home mortgage interest? 21. How much can Ally deduct for gifts to charity? 22. Will Ally use the itemized or standard deduction? 23. Back to the 1040, how much credit will Ally get for the child tax credit? 24. Does Ally pay tax on her alimony received? 25. Does Ally pay tax on any child support received? MacBook Air