Heather and Nick Johnson are married and file a joint income tax return. Their address is 3847 Indian Trail, Madison, WI 58493. Nick's Social Security number is 527-01-1115 and birth date 10/15/1968. Heather's social security number is 655-10-2224 and birth date 6/12/1970. Nick is an electrical engineer, and Heather is a speech therapist. She is self-employed. They report all their income and expenses on the cash method. For 2019, they report the following items of income and expense:

The W-2 form and 1098 form

Gross receipts from Heather's business $112,000

Rent on Heather's office $15,000

Receivables written off during the year (received in Heather's business) $1,300

Subscriptions to linguistic journals for Heather $250

Salary for Heather's secretary-receptionist $24,000

Qualified medical expenses $11,000

Property taxes on their personal residence $3,000

State income tax refund received this year (the tax benefit was received in the prior year from the state income tax deduction) $650

Heather's estimated tax payments $20,500

Income tax preparation fee for the prior year's return paid this year $1,000

Heather and Nick sold the following assets:

Asset

Aquired

Sold

Sales Price

Cost

KNA Stock

2/12/2015

3/13/2019

$14,000

$9,000

AEN Stock

3/2/2019

7/17/2019

$20,000

$21,000

KLN Stock

6/8/2011

4/10/2019

$13,000

$16,000

Motorcycle

5/3/2008

9/12/2019

$2,500

$5,000

Heather owned the KLN stock and sold it to her brother, Jack. Heather and Nick used the motorcycle for personal recreation. In addition to the items above, they donate Miner Corporation stock to their community church. The FMV of the stock on the date it is donated (8/18/19) is $6,200. It cost $2,700 when purchased on 3/12/98. Heather and Nick's home was burglarized during the tax year 2019 The burglar stole an entertainment system (FMV $3,500; cost $5,000), an antique diamond ring and pendant (FMV $12,000; cost $10,000), and a painting (FMV $1,500; cost $1,300). The insurance company pays $1,500 for the entertainment system, $4,000 for the jewelry, and $500 for the painting. Complete Heather and Nick's Form 1040 for tax year 2019, Schedules A, C, D, and SE, Form 4684, and Form 8283. For purposes of this tax problem, disregard the alternative minimum tax and any credits.