Hi,

I need help with my homework assignment for my federal income taxation accounting class. It is on chapter 8: Individual income tax computation and tax credits from the text bookTaxation of Individuals 2017 (8th edition), by Spilker, etc.

Homework 7

Use your textbook and the instructions for the forms, which can be found at IRS.gov, to complete the required forms.

• William (52) and Carla (50) Jones have 3 children: Mark, age 14 (SSN 124-58-1111) and Tom, age 10 (SSN 124-58-1112) and Kim, age 8 (SSN 124-58-9898). The Jones paid $12,000 to Kids R Us (EIN 22-1134565) for daycare ($5,000 for Tom and Kim and $2,000 for Mark). William works full-time and earned $55,000 this year, while Carla worked part-time and made $5,000. Assume AGI of $60,000 and tax liability before credits of $8,073.

Required: Prepare Form 2441 for the Jones

• Alice (25) Smith is a single parent who files Head of Household, with AGI of $60,000. Alice took one class at the local community college at night to improve her job skills. She spent $1,000 in tuition to Orange Community College (EIN 34-4213415). Her daughter, Melanie, is 19 and a full-time student at Penn State (EIN 43-1233454). Melanie is in her second year, and has never been convicted of a drug crime. Her tuition after scholarships was $10,000. Both Alice and Melanie received forms 1098-T showing their tuition amounts.

Required: Prepare Form 8863 for Alice (Hint: A separate page 2 must be completed for each person in college).

For lines 18 & 19 you do not need to complete the credit limitation worksheet; line 19 is equal to line 18 + line 9.

I have attached the required forms that must be completed to this post.

Thank you!

Form 2441 Child and Dependent Care Expenses Department of the Treasury Internal Revenue Service (99) 1040 1040A .......... .......... Attach to Form 1040, Form 1040A, or Form 1040NR. OMB No. 1545-0074 2441 Information about Form 2441 and its separate instructions is at www.irs.gov/form2441. 1 Attachment Sequence No. 21 Your social security number Name(s) shown on return Part I 2015 1040NR Persons or Organizations Who Provided the CareYou must complete this part. (If you have more than two care providers, see the instructions.) (a) Care provider's name (b) Address (number, street, apt. no., city, state, and ZIP code) (c) Identifying number (SSN or EIN) (d) Amount paid (see instructions) Complete only Part II below. No Did you receive dependent care benefits? Complete Part III on the back next. Yes Caution. If the care was provided in your home, you may owe employment taxes. If you do, you cannot file Form 1040A. For details, see the instructions for Form 1040, line 60a, or Form 1040NR, line 59a. Part II 2 Credit for Child and Dependent Care Expenses Information about your qualifying person(s). If you have more than two qualifying persons, see the instructions. (b) Qualifying person's social security number (a) Qualifying person's name Last First 3 Add the amounts in column (c) of line 2. Do not enter more than $3,000 for one qualifying person or $6,000 for two or more persons. If you completed Part III, enter the amount from line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . 4 5 Enter your earned income. See instructions . . . . . . . . . . . . . . . If married filing jointly, enter your spouse's earned income (if you or your spouse was a student or was disabled, see the instructions); all others, enter the amount from line 4 . 6 7 Enter the smallest of line 3, 4, or 5 . . . . . . . Enter the amount from Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37 . . . . . 8 9 10 11 . . . . . . . . . . . (c) Qualified expenses you incurred and paid in 2015 for the person listed in column (a) 3 4 5 6 7 Enter on line 8 the decimal amount shown below that applies to the amount on line 7 If line 7 is: But not over Over Decimal amount is If line 7 is: $015,000 15,00017,000 17,00019,000 19,00021,000 21,00023,000 23,00025,000 25,00027,000 27,00029,000 .35 .34 .33 .32 .31 .30 .29 .28 Over But not over $29,00031,000 31,00033,000 33,00035,000 35,00037,000 37,00039,000 39,00041,000 41,00043,000 43,000No limit Decimal amount is .27 .26 .25 .24 .23 .22 .21 .20 8 Multiply line 6 by the decimal amount on line 8. If you paid 2014 expenses in 2015, see the instructions . . . . . . . . . . . . . . . . . . . . . . . . . Tax liability limit. Enter the amount from the Credit Limit Worksheet in the instructions. . . . . . . 10 Credit for child and dependent care expenses. Enter the smaller of line 9 or line 10 here and on Form 1040, line 49; Form 1040A, line 31; or Form 1040NR, line 47 . . . . For Paperwork Reduction Act Notice, see your tax return instructions. X. 9 11 Cat. No. 11862M Form 2441 (2015) Page 2 Form 2441 (2015) Part III Dependent Care Benefits 12 Enter the total amount of dependent care benefits you received in 2015. Amounts you received as an employee should be shown in box 10 of your Form(s) W-2. Do not include amounts reported as wages in box 1 of Form(s) W-2. If you were self-employed or a partner, include amounts you received under a dependent care assistance program from your sole proprietorship or partnership . . . . . . . . . . . . . . . . . . 13 Enter the amount, if any, you carried over from 2014 and used in 2015 during the grace period. See instructions . . . . . . . . . . . . . . . . . . . . . . . 14 Enter the amount, if any, you forfeited or carried forward to 2016. See instructions 15 Combine lines 12 through 14. See instructions . . . . . . . . . . . . 16 Enter the total amount of qualified expenses incurred in 2015 for the care of the qualifying person(s) . . . 16 17 Enter the smaller of line 15 or 16 . . . . . . . . 18 Enter your earned income. See instructions . . . . 19 Enter the amount shown below that applies to you. If married filing jointly, enter your spouse's earned income (if you or your spouse was a student or was disabled, see the instructions for line 5). If married filing separately, see instructions. } . . . . . . . . . 12 13 14 ( 15 ) 17 18 19 All others, enter the amount from line 18. 20 Enter the smallest of line 17, 18, or 19 . . . . . . 20 21 Enter $5,000 ($2,500 if married filing separately and you were required to enter your spouse's earned income on line 19) . . . . . . . . . . . . . 21 22 Is any amount on line 12 from your sole proprietorship or partnership? (Form 1040A filers go to line 25.) No. Enter -0-. Yes. Enter the amount here . . . . . . . . . . . . . . . . . . . . 23 23 Subtract line 22 from line 15 . . . . . . . . . 24 Deductible benefits. Enter the smallest of line 20, 21, or 22. Also, include this amount on the appropriate line(s) of your return. See instructions . . . . . . . . . . . . . 22 24 25 Excluded benefits. Form 1040 and 1040NR filers: If you checked \"No\" on line 22, enter the smaller of line 20 or 21. Otherwise, subtract line 24 from the smaller of line 20 or line 21. If zero or less, enter -0-. Form 1040A filers: Enter the smaller of line 20 or line 21 . . 25 26 Taxable benefits. Form 1040 and 1040NR filers: Subtract line 25 from line 23. If zero or less, enter -0-. Also, include this amount on Form 1040, line 7, or Form 1040NR, line 8. On the dotted line next to Form 1040, line 7, or Form 1040NR, line 8, enter \"DCB.\" Form 1040A filers: Subtract line 25 from line 15. Also, include this amount on Form 1040A, line 7. In the space to the left of line 7, enter \"DCB\" . . . . . . . . . . . . . . 26 To claim the child and dependent care credit, complete lines 27 through 31 below. 27 Enter $3,000 ($6,000 if two or more qualifying persons) . . . . . . . . . . . . 28 Form 1040 and 1040NR filers: Add lines 24 and 25. Form 1040A filers: Enter the amount from line 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Subtract line 28 from line 27. If zero or less, stop. You cannot take the credit. Exception. If you paid 2014 expenses in 2015, see the instructions for line 9 . . . . . 30 Complete line 2 on the front of this form. Do not include in column (c) any benefits shown on line 28 above. Then, add the amounts in column (c) and enter the total here. . . . . 31 Enter the smaller of line 29 or 30. Also, enter this amount on line 3 on the front of this form and complete lines 4 through 11 . . . . . . . . . . . . . . . . . . . . 27 28 29 30 31 Form 2441 (2015) Form 8863 Department of the Treasury Internal Revenue Service (99) Education Credits (American Opportunity and Lifetime Learning Credits) OMB No. 1545-0074 CAUTION Part I Complete a separate Part III on page 2 for each student for whom you are claiming either credit before you complete Parts I and II. Refundable American Opportunity Credit 1 2 After completing Part III for each student, enter the total of all amounts from all Parts III, line 30 Enter: $180,000 if married filing jointly; $90,000 if single, head of household, or qualifying widow(er) . . . . . . . . . . . . . 2 3 Enter the amount from Form 1040, line 38, or Form 1040A, line 22. If you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from Puerto Rico, see Pub. 970 for the amount to enter . . . . . . . . 3 Subtract line 3 from line 2. If zero or less, stop; you cannot take any education credit . . . . . . . . . . . . . . . . . . . 4 Enter: $20,000 if married filing jointly; $10,000 if single, head of household, or qualifying widow(er) . . . . . . . . . . . . . . . . . 5 If line 4 is: Equal to or more than line 5, enter 1.000 on line 6 . . . . . . . . . . . . Less than line 5, divide line 4 by line 5. Enter the result as a decimal (rounded to at least three places) . . . . . . . . . . . . . . . . . . . . . 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 } . . 1 . . . Multiply line 1 by line 6. Caution: If you were under age 24 at the end of the year and meet the conditions described in the instructions, you cannot take the refundable American opportunity credit; skip line 8, enter the amount from line 7 on line 9, and check this box . . . . Refundable American opportunity credit. Multiply line 7 by 40% (.40). Enter the amount here and on Form 1040, line 68, or Form 1040A, line 44. Then go to line 9 below. . . . . . . . . . Part II Attachment Sequence No. 50 Your social security number Name(s) shown on return ! 2015 Attach to Form 1040 or Form 1040A. Information about Form 8863 and its separate instructions is at www.irs.gov/form8863. 6 . 7 8 Nonrefundable Education Credits Subtract line 8 from line 7. Enter here and on line 2 of the Credit Limit Worksheet (see instructions) After completing Part III for each student, enter the total of all amounts from all Parts III, line 31. If zero, skip lines 11 through 17, enter -0- on line 18, and go to line 19 . . . . . . . . . . Enter the smaller of line 10 or $10,000 . . . . . . . . . . . . . . . . . . . . Multiply line 11 by 20% (.20) . . . . . . . . . . . . . . . . . . . . . . . Enter: $130,000 if married filing jointly; $65,000 if single, head of household, or qualifying widow(er) . . . . . . . . . . . . . 13 Enter the amount from Form 1040, line 38, or Form 1040A, line 22. If you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from Puerto Rico, see Pub. 970 for the amount to enter . . . . . . . . 14 Subtract line 14 from line 13. If zero or less, skip lines 16 and 17, enter -0on line 18, and go to line 19 . . . . . . . . . . . . . . . 15 Enter: $20,000 if married filing jointly; $10,000 if single, head of household, or qualifying widow(er) . . . . . . . . . . . . . . . . . 16 If line 15 is: Equal to or more than line 16, enter 1.000 on line 17 and go to line 18 Less than line 16, divide line 15 by line 16. Enter the result as a decimal (rounded to at least three places) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Multiply line 12 by line 17. Enter here and on line 1 of the Credit Limit Worksheet (see instructions) Nonrefundable education credits. Enter the amount from line 7 of the Credit Limit Worksheet (see instructions) here and on Form 1040, line 50, or Form 1040A, line 33 . . . . . . . . . . For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 25379M 9 10 11 12 17 18 19 . Form 8863 (2015) Page 2 Form 8863 (2015) Your social security number Name(s) shown on return ! CAUTION Part III Complete Part III for each student for whom you are claiming either the American opportunity credit or lifetime learning credit. Use additional copies of page 2 as needed for each student. Student and Educational Institution Information See instructions. 20 Student name (as shown on page 1 of your tax return) 22 21 Student social security number (as shown on page 1 of your tax return) Educational institution information (see instructions) a. Name of first educational institution b. Name of second educational institution (if any) (1) Address. Number and street (or P.O. box). City, town or post office, state, and ZIP code. If a foreign address, see instructions. (1) Address. Number and street (or P.O. box). City, town or post office, state, and ZIP code. If a foreign address, see instructions. (2) Did the student receive Form 1098-T (2) Did the student receive Form 1098-T Yes No Yes No from this institution for 2015? from this institution for 2015? (3) Did the student receive Form 1098-T (3) Did the student receive Form 1098-T Yes No Yes No from this institution for 2014 with Box from this institution for 2014 with Box 2 2 filled in and Box 7 checked? filled in and Box 7 checked? If you checked \"No\" in both (2) and (3), skip (4). If you checked \"No\" in both (2) and (3), skip (4). (4) If you checked \"Yes\" in (2) or (3), enter the institution's (4) If you checked \"Yes\" in (2) or (3), enter the institution's federal identification number (from Form 1098-T). federal identification number (from Form 1098-T). - - 23 24 25 26 Has the Hope Scholarship Credit or American opportunity credit been claimed for this student for any 4 tax years before 2015? Yes Stop! Go to line 31 for this student. Was the student enrolled at least half-time for at least one academic period that began or is treated as having begun in 2015 at an eligible educational institution in a program leading towards a postsecondary degree, certificate, or other recognized postsecondary educational credential? (see instructions) Yes Go to line 25. No Go to line 24. No Stop! Go to line 31 for this student. Did the student complete the first 4 years of postsecondary education before 2015 (see instructions)? Yes Stop! Go to line 31 for this student. No Go to line 26. Was the student convicted, before the end of 2015, of a felony for possession or distribution of a controlled substance? Yes Stop! Go to line 31 for this student. No Complete lines 27 through 30 for this student. ! CAUTION You cannot take the American opportunity credit and the lifetime learning credit for the same student in the same year. If you complete lines 27 through 30 for this student, do not complete line 31. American Opportunity Credit 27 28 29 30 Adjusted qualified education expenses (see instructions). Do not enter more than $4,000 . . . . Subtract $2,000 from line 27. If zero or less, enter -0- . . . . . . . . . . . . . . . . . Multiply line 28 by 25% (.25) . . . . . . . . . . . . . . . . . . . . . . . . . If line 28 is zero, enter the amount from line 27. Otherwise, add $2,000 to the amount on line 29 and enter the result. Skip line 31. Include the total of all amounts from all Parts III, line 30, on Part I, line 1 . 27 28 29 30 Lifetime Learning Credit 31 Adjusted qualified education expenses (see instructions). Include the total of all amounts from all Parts III, line 31, on Part II, line 10 . . . . . . . . . . . . . . . . . . . . . . . . . 31 Form 8863 (2015)