Instructions Comprehensive Problem 2-1 Beverly and Ken Hair have been married for 3 years. Both taxpayers are under age 65. Beverly works as an accountant at Cypress Corporation. Ken is a full-time student at Southwest Missouri State University (SMSU) and also works part-time during the summer at Cypress Corp. Ken's birthdate is January 12, 1992 and Beverly's birthdate is November 4, 1994. Beverly and Ken each received a W-2 form from Cypress Corporation. The Hairs have interest income of $1,000 on City of St. Louis bonds. Beverly and Ken also received a Form 1099-INT from Boatman's Bank and a 1099-DIV form from green Corporation. Ken is an excellent student at SMSU. He was given a $1,750 scholarship by the university to help pay educational expenses. The scholarship funds were used by Ken for tuition and books. Last year, Beverly was laid off from her former job and was unemployed during January 2018. She was paid $1,825 of unemployment compensation until she started work with her current employer, Cypress Corporation. Ken has a 4-year-old son, Robert R. Hair, from a prior marriage that ended in divorce in 2013, During 2018, he paid his ex-wife 300 per month in child support. Robert is claimed as a dependent by Ken's ex-wife. During 2018, Ken's aunt died. The aunt, in her willit Ken s During 2018, Ken's aunt died. The aunt, in her will, left Ken $15,000 in cash. Ken deposited this money in the Boatman's Bank savings account. Required: Complete the Hair's Form 1040, Schedule 1, and the Qualified Dividends and Capital Gain Tax Worksheet. The Hair's had health cover for the entire year. They do not want to make any contribution to the presidential election campaign. Make any other realistic assumptions about any missing data. If an amount box does not require an entry or if an amount is zero, enter "o". Enter amounts as positive numbers. If required, round amounts to the nearest dollar. Form 1040 (2018) Page 2 53,400 2a 3a 4a 2b 2,533 X Tax-exempt interest Qualified dividends IRAs, pensions, and 1,000 b Taxable interest b Ordinary dividends 3b b Taxable amount 300 300 | Attach Form (s) W- 2. Also attach Form(s) W-2G and 1099-R if tax was 5a Social security benefits 5a withheld 4a 4b annuities b Taxable amount 5b 6 Total income. Add lines 1 through 5. Add any amount from Schedule 1, line 22 54,347X Adjusted gross income. If you have no adjustments to income, enter the amount from line 6; otherwise, subtract Schedule 1, line 36, from line 6.. . .. . . . . . .. . . 6 54,347X 7 7 54,347X Standard 8 Standard deduction or itemized deductions (from Schedule A). . .. . . . . 9 Qualified business income deduction (see instructions) . . . . . . . . . . . . . . . . . . . . 9 10 Taxable income. Subtract lines 8 and 9 from line 7. If zero or less, enter-0-.. 11 a Tax (see inst) 8 24,000V Deduction for- Single or married filing separately $12,000 10 30,347X 0X (check if any from: 1 Form(s) 8814 2 Form Married filing jointly or Qualifying widow(er), $24,000 4972 3 D b Add any amount from Schedule 2 and check here . a Child tax credit/credit for other dependents b Add any amount from Schedule 3 and check here. _ . . . . . . . . . Subtract line 12 from line 11. If zero or less, enter -0-. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .> 11 12 Head of household, $18,000 .If you checked any box under Standard deduction, see instructions . .12 13 14 15 16 13 15 16 17 Total tax. Add lines 13 and 14 .. _ . . . _ . . . . . . . . . . . ._ . . . . . . .. Federal income tax withheld from Forms W-2 and 1099 . . . . . . . . . . .. . . . Refundable credits: a EIC (see inst.) Form 8863 Add any amount from Schedule 5 Add lines 16 and 17. These are your total payments . If line 18 is more than line 15, subtract line 15 from line 18. This is the amount you 4,892 b Sch 8812 17 18 18 4,892 V . . 19 Refund 19 4,892 X Instructions Comprehensive Problem 2-1 Beverly and Ken Hair have been married for 3 years. Both taxpayers are under age 65. Beverly works as an accountant at Cypress Corporation. Ken is a full-time student at Southwest Missouri State University (SMSU) and also works part-time during the summer at Cypress Corp. Ken's birthdate is January 12, 1992 and Beverly's birthdate is November 4, 1994. Beverly and Ken each received a W-2 form from Cypress Corporation. The Hairs have interest income of $1,000 on City of St. Louis bonds. Beverly and Ken also received a Form 1099-INT from Boatman's Bank and a 1099-DIV form from green Corporation. Ken is an excellent student at SMSU. He was given a $1,750 scholarship by the university to help pay educational expenses. The scholarship funds were used by Ken for tuition and books. Last year, Beverly was laid off from her former job and was unemployed during January 2018. She was paid $1,825 of unemployment compensation until she started work with her current employer, Cypress Corporation. Ken has a 4-year-old son, Robert R. Hair, from a prior marriage that ended in divorce in 2013, During 2018, he paid his ex-wife 300 per month in child support. Robert is claimed as a dependent by Ken's ex-wife. During 2018, Ken's aunt died. The aunt, in her willit Ken s During 2018, Ken's aunt died. The aunt, in her will, left Ken $15,000 in cash. Ken deposited this money in the Boatman's Bank savings account. Required: Complete the Hair's Form 1040, Schedule 1, and the Qualified Dividends and Capital Gain Tax Worksheet. The Hair's had health cover for the entire year. They do not want to make any contribution to the presidential election campaign. Make any other realistic assumptions about any missing data. If an amount box does not require an entry or if an amount is zero, enter "o". Enter amounts as positive numbers. If required, round amounts to the nearest dollar. Form 1040 (2018) Page 2 53,400 2a 3a 4a 2b 2,533 X Tax-exempt interest Qualified dividends IRAs, pensions, and 1,000 b Taxable interest b Ordinary dividends 3b b Taxable amount 300 300 | Attach Form (s) W- 2. Also attach Form(s) W-2G and 1099-R if tax was 5a Social security benefits 5a withheld 4a 4b annuities b Taxable amount 5b 6 Total income. Add lines 1 through 5. Add any amount from Schedule 1, line 22 54,347X Adjusted gross income. If you have no adjustments to income, enter the amount from line 6; otherwise, subtract Schedule 1, line 36, from line 6.. . .. . . . . . .. . . 6 54,347X 7 7 54,347X Standard 8 Standard deduction or itemized deductions (from Schedule A). . .. . . . . 9 Qualified business income deduction (see instructions) . . . . . . . . . . . . . . . . . . . . 9 10 Taxable income. Subtract lines 8 and 9 from line 7. If zero or less, enter-0-.. 11 a Tax (see inst) 8 24,000V Deduction for- Single or married filing separately $12,000 10 30,347X 0X (check if any from: 1 Form(s) 8814 2 Form Married filing jointly or Qualifying widow(er), $24,000 4972 3 D b Add any amount from Schedule 2 and check here . a Child tax credit/credit for other dependents b Add any amount from Schedule 3 and check here. _ . . . . . . . . . Subtract line 12 from line 11. If zero or less, enter -0-. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .> 11 12 Head of household, $18,000 .If you checked any box under Standard deduction, see instructions . .12 13 14 15 16 13 15 16 17 Total tax. Add lines 13 and 14 .. _ . . . _ . . . . . . . . . . . ._ . . . . . . .. Federal income tax withheld from Forms W-2 and 1099 . . . . . . . . . . .. . . . Refundable credits: a EIC (see inst.) Form 8863 Add any amount from Schedule 5 Add lines 16 and 17. These are your total payments . If line 18 is more than line 15, subtract line 15 from line 18. This is the amount you 4,892 b Sch 8812 17 18 18 4,892 V . . 19 Refund 19 4,892 X