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Individual Tax Return Problem 3 Required: Use the following information to complete Phillip and Claire Dunphy s 2 0 2 3 federal income tax return
Individual Tax Return Problem
Required:
Use the following information to complete Phillip and Claire Dunphys federal income tax return using the practice lab software. If any information is missing, use reasonable assumptions to fill in the gaps.
Facts:
Phillip and Claire are married and file a joint return. Phillip is selfemployed as a real estate agent, and Claire is a homemaker. Phillip and Claire have three dependent children. All three children live at home with Phillip and Claire for the entire year.
The Dunphys provide you with the following additional information:
The Dunphys do not want to contribute to the presidential election campaign.
The Dunphys live at Brighton Avenue, Miami, Florida
Phillips birthday is and his Social Security number is XX
Claires birthday is and her Social Security number is XX
Haleys birthday is and her Social Security number is XX
Alexs birthday is and her Social Security number is XX
Lukes birthday is and his Social Security number is XX
The Dunphys do not have any foreign bank accounts or trusts.
Phillip and Claire received $ of interest from State Savings Bank on a joint account. They also received a qualified dividend of $ on jointly owned stock in Xila Corporation.
Phillips fulltime real estate business is named Phillip Dunphy Realty. His business is located at Grove Street, Miami, Florida and his employer identification number is Phillips gross receipts during were $ Phillip uses the cash method of accounting for his business. Phillips business expenses are as follows:
Advertising $
Professional dues
Professional journals
Employee wages
Insurance on office contents
Accounting services
Miscellaneous office expense
Utilities and telephone
Payroll taxes
Depreciation To be calculated
On April Phillip moved his business into a newly constructed and equipped office on Grove Street. Phillips expenditures for the new office building are as follows:
Date Acquired Asset Cost
Land $
Office building
Furniture
Computer system
Phillip computes his cost recovery allowance using MACRS. He elects NOT to use immediate expensing or any bonus depreciation. Phillip has never claimed or bonus depreciation before.
Phillip also has office equipment that was originally purchased in He has been using MACRS year property and the halfyear convention since the original purchase:
Date Acquired Asset Original Cost Accumulated Depreciation as of Beginning of the Year
Office equipment
Phillip uses his Honda Pilot to show properties to his clients. The car was originally placed in service on July In he used the car miles commuting to and from work, miles for business and miles other personal
Phillip and Claire contributed $ each to a traditional IRA.
The Dunphys paid $ per month $ for family health insurance coverage.
The Dunphys made timely estimated federal income tax payments of $ each quarter during
Assume the Dunphys take the standard deduction in
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