Instructions: Please complete the 2019 federal income tax return for Joseph and Diana Cohen. Ignore the requirement to attach the form(s) W-2 to the front page of the Form 1040. If required information is missing, use reasonable assumptions to fill in the gaps. Joseph and Diana Cohen live in Pleasantville, New Jersey. Joseph is the Vice-President of Sales at a small start-up company. Diana is a former advertising executive who currently consults with former clients. She also serves on the board of directors of an advertising company. The Cohens have three children Rebecca (age 18), Alan (age 15), and David (age 12). In January, Rebecca left home to attend a liberal arts college. All three children qualify as Joseph and Diana's federal income tax dependents. The Cohens plan to file a joint tax return. The Cohens provided the following information: Joseph's social security number is 598-94-2583 . Diana's social security number is 301-52-2942 Rebecca's social security number is 887-44-8710 Alan's social security number is 810-42-9092 David's social security number is 855-11-3021 The Cohen's mailing address is 85 North Maple Drive, Pleasantville, New Jersey 08232 Joseph Cohen reported the following the following information relating to his employment during the year: Employer Gross Wages Federal Income Tax State Income Tax Withholding Withholding Alternative Energy $148,325 $25,230 $8,900 The above amounts do not reflect any income items described below. Joseph's employer withheld all payroll taxes it was required to withhold. The entire Cohen family was covered by minimum essential health insurance during each month in 2019. The insurance was provided by Joseph's employer, Alternative Energy. Diana Cohen received the following revenue during the year (she uses the cash method of accounting). Consulting revenue reported to her on a Form 1099-MISC, Box 7 High-end Retail $32,000 Jensen's Health Products $8,500 Strategic Solutions $3,750 Board of director compensation reported to her on a Form 1099-MISC, Box 7 Natural Sunshine, Inc. $6,500 In each of these self-employment endeavors, Diana is an active participant, and both activities are considered specified service trades or businesses for purposes of the Qualified Business Income Deduction. Assume both activities qualify as a trade or business.During the year, Diana paid the following business expenses for each activity: Consultant-related: Airfare $2,900 Hotel $1,450 Meals $390 Parking $320 Diana drove 290 business miles for her consulting-related activities (she has documentation to verify} Board of Director-related: Meals $124 Hotel $225 Diana drove 315 business miles for her board of director activities (she has documentation to verify) Neither of Diana's business activities required the filing of Form(s] 1099 to report payments she made during the tax year. In addition, Ms. Cohen drove a 2017 Lexus purchased on January 1, 2017 for all her business mileage. She drove the vehicle a total of 10,605 miles during the year for all purposes. Diana has written documentation to support the mileage amounts. She also has access to another vehicle for personal purposes. The Cohens also received the following during the year: Interest income from First Bank of New Jersey $320 Interest income from Patterson, New Jersey School District $200 Interest income from US. Treasury Bond $350 Interest income from General Mills corporate bond $400 Interest income from the State of Maine's Tourism Support Private Activity Bond $50,000 Qualified dividend income from Rio Tinto $1,500 Qualified dividend income from Microsoft $750 Qualified dividend income from Cooper Tire $200 Qualified dividend income from Cardinal Health $425 Qualified dividend income from Union Pacific $140 Qualified dividend income from Procter 8: Gamble $190 Qualified dividend income from PepsiCo $225 Qualified dividend income from Kellogg $200 Qualified dividend income from Abbott Labs $275 Qualified dividend income from 3M $350 Dividend income (not qualified) from China Fund $2,000 The Cohens did not own, control or manage any foreign bank accounts, nor were they grantors or beneficiaries of a foreign trust during the tax year. The Cohens had the following activity in their brokerage account during the year (all transactions were reported on a Form 1099-8 and basis information for each stock sale was reported to the IRS}: Sold 2,000 shares of Microsoft 7/1/19 $22,500 Sold 75 shares of Apple, Inc. 4/15/19 $28,750 Sold 350 shares of Cooper Tire 10/14/19 $14,700 Sold 1,000 shares of Cardinal Health 9/3/19 $35,000 Sold 50 shares of Union Pacific 1/7/19 $2,750 Purchased 100 shares of Procter 8: Gamble 7/10/19 $7,700 Purchased 350 shares of Cooper Tire 11/1/19 $14,000 Purchased 350 shares of PepsiCo 5/14/19 $32,000 Purchased 300 shares of Kellogg 10/14/19 $21,000 Relevant tax basis/holding period information related to sales of securities in the current year: Purchased 2,000 shares of Microsoft on 5/1/19 for $21,000 Purchased 200 shares of Apple, Inc. on 3/8/17 for $90,000 Purchased 300 shares of Cooper Tire on 1/12/ 16 for $9,000 Purchased 50 shares of Cooper Tire on 6/28/19 for $2,000 Received 1,000 shares of Cardinal Health from Dian a's father as a gift on 10/10/03. Her father's basis in the stock at the time of the gift was $7,000. Fair market value of the stock at the date of the gift was $41,000 Purchased 100 shares of Union Pacific on 9/5/18 for $6,000 The Cohens have a $43,000 long-term capital loss carryover from the prior tax year. The Co hens received a New Jersey state income tax refund of $400 in May of 2019. The Cohens received the refund because they had overpaid their New Jersey state individual income tax in 2018. On their 2018 Federal income tax return, the Cohens itemized, and deducted and received a tax benefit for all state tax income taxes paid in 2018. Diana is a 10% owner in an advertising agency named Bright Ideas ("Bl\") (EIN 20-1234567). BI is a Subchapter S corporation located at 4700 MM Lane, West Rockport, ME 04865. The company reported ordinary business income for the year of $150,000. Diana received a K-1 from BI reporting her allocation of this business income. Diana acquired the stock several years ago. Her basis in the stock before considering her 2019 income allocation was $92,000. Diana is a passive owner with respect to this entity, and all her investment is at risk. Diana received no distribution from BI in 2019. BI is a specified service business for purposes of the Qualified Business Income Deduction, generating $150,000 of Qualified Business Income and paying $50,000 in W-Z wages to its non-shareholder employees. Diana is also a 20% owner in Natural Sunshine, Inc. (\"NS\") (EIN 24-9876543). N5 is a Subchapter S corporation located at 6488 WYWH Dr, Islamorada, FL 33036. The company reported an ordinary business loss for the year of ($80,000). Diana received a I(-1 from N5 reporting her allocation of this business loss. Diana acquired the stock several years ago. Her basis in the stock before considering her 2019 loss allocation was $45,000. Diana is a passive owner with respect to this entity. N5 is not a specified service business for purposes of the Qualied Business Income Deduction. Joseph received 5,000 shares of restricted (common) stock from his employer on July 1, 2019. The terms of the restricted stock grant are such that if Joseph is still employed by Alternative Energy on July 1, 2022 the entire 5,000 shares will vest and become his property. Joseph, upon the advice of his tax advisor, prepared and led an IRC Section 83(b) election on July 8, 2019. On July 1, 2019, the shares were valued at $5 per share. Joseph estimates the value ofthe shares in ve years will be at least $150 per share. Joseph notied Alternative Energy about the IRC Section 83(b) election in a timely manner. None of the income tax consequences of this restricted stock grant was included in the $178,325 reported as part of Joseph's gross wages (see above), so if Joseph has a 2019 tax consequence from the granting or 83(b) election, he will report it as other income. The Cohens paid the following expenses during the year: Dentist (unreimbursed by insurance) $1,500 Doctors (unreimbursed by insurance) $ 2,425 Prescriptions (unreimbursed by insurance) 5 675 Real property taxes on residence $7,525 Vehicle (not used for business) property tax based upon value $2,250 Mortgage interest on principal residence mortgage of $600,000 $20,550 Home equity interest on $40,000 mortgage used to purchase new car $3,600 Contribution to United Way $5,000 Contribution to American Cancer Society $7,000 Contribution to neighborhood drive to oppose development project $500 Contribution to the Temple Mount Synagogue $15,000 The Cohens also donated clothing, electronics, furniture and other household goods to the Salvation Army of Pleasantville, New Jersey on April 15, 2019. Estimated thrift value of the goods donated was $375. Miscellaneous Information On September 1, the Cohens paid $200 in foreign taxes attributable to the dividend received from the China Fund. The Cohens would like to contribute to the Presidential Election Campaign Fund. The Cohens would also like to receive a refund (if any) of tax they may have overpaid for the year. Their preferred method of receiving the refund is by check. $1040 Department of the Treasury-Internal Revenue Service_ (99) U.S. Individual Income Tax Return 2019 OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space. Filing Status | Single ]Married filing jointly Married filing separately (MFS) Head of household (HOH) [Qualifying widow(er) (QW) Check onl If you checked the MFS box, enter the name of spouse. If you checked the HOH or QW box, enter the child's name if the qualifying person is one box. a child but not your dependent. Your first name and middle initial Last name Your social security number If joint return, spouse's first name and middle initial Last name Spouse's social security number Home address (number and street). If you have a P.O. box, see instructions. Apt. no. Presidential Election Campaign Check here if you, or your spouse if filing jointly, want $3 to go to this fund City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below (see instructions). Checking a box below will not change your tax or refund. You Spouse Foreign country name Foreign province/state/county Foreign postal code If more than four dependents, see instructions and / here Standard Someone can claim: You as a dependent Your spouse as a dependent Deduction Spouse itemizes on a separate return or you were a dual-status alien Age/Blindness You: | Were born before January 2, 1955 Are blind Spouse: Was born before January 2, 1955 Is blind Dependents (see instructions): (2) Social security number (3) Relationship to you (4) . if qualifies for (see instructions): (1) First name Last name Child tax credit Credit for other dependents Wages, salaries, tips, etc. Attach Form(s) W-2 2a Tax-exempt interest . 2a b Taxable interest. Attach Sch. B if required 2b 3a Qualified dividends 3a b Ordinary dividends. Attach Sch. B if required 3b Standard Deduction for- 4a IRA distributions . 4a b Taxable amount 4b . Single or Married C Pensions and annuities 4c d Taxable amount 4d filing separately, $12,200 Social security benefits . 5a b Taxable amount 5b Married filing 6 jointly or Qualifying 6 Capital gain or (loss). Attach Schedule D if required. If not required, check here widow(er), 7a $24,40 Other income from Schedule 1, line 9 . 7a Head of b Add lines 1, 2b, 3b, 4b, 4d, 5b, 6, and 7a. This is your total income 7b household $18,350 Ba Adjustments to income from Schedule 1, line 22 8a If you checked b Subtract line 8a from line 7b. This is your adjusted gross income 8b any box under Standar 9 Standard deduction or itemized deductions (from Schedule A) Deduction, 10 Qualified business income deduction. Attach Form 8995 or Form 8995-A 10 see instructions 11a Add lines 9 and 10 11a b Taxable income. Subtract line 11a from line 8b. If zero or less, enter -0- 11b For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2019)Form 1040 (2019) Page 2 12a Tax (see inst.) Check if any from Form(s): 1 8814 2 4972 3 12a Add Schedule 2, line 3, and line 12a and enter the total 12b 13a Child tax credit or credit for other dependents 13a b Add Schedule 3, line 7, and line 13a and enter the total 13b 14 Subtract line 13b from line 12b. If zero or less, enter -0- 14 15 Other taxes, including self-employment tax, from Schedule 2, line 10 15 16 Add lines 14 and 15. This is your total tax 16 17 Federal income tax withheld from Forms W-2 and 1099 17 18 . If you have a Other payments and refundable credits: qualifying child attach Sch. EIC. a Earned income credit (EIC) . 18a . If you have b Additional child tax credit. Attach Schedule 8812 18b nontaxable C 18c combat pay, see American opportunity credit from Form 8863, line 8 nstructions. d Schedule 3, line 14 18d e Add lines 18a through 18d. These are your total other payments and refundable credits 18e 19 Add lines 17 and 18e. These are your total payments 19 Refund 10 If line 19 is more than line 16, subtract line 16 from line 19. This is the amount you overpaid 20 21a Amount of line 20 you want refunded to you. If Form 8888 is attached, check here 21a Direct deposit? b Routing number c Type: | Checking Savings See instructions Account number 2 Amount of line 20 you want applied to your 2020 estimated tax 22 Amount 3 Amount you owe. Subtract line 19 from line 16. For details on how to pay, see instructions 23 You Owe 24 Estimated tax penalty (see instructions) . 24 Third Party Do you want to allow another person (other than your paid preparer) to discuss this return with the IRS? See instructions. Yes. Complete below. Designee NO (Other than Designee's Phone Personal identification paid preparer) name no. number (PIN) Sign Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Here Your signature Date Your occupation If the IRS sent you an Identity Protection PIN, enter it here Joint return? (see inst.) See instructions. Spouse's signature. If a joint return, both must sign. Date Spouse's occupation If the IRS sent your spouse an Keep a copy for Identity Protection PIN, enter it here your records (see inst.) Phone no. Email address Preparer's name Preparer's signature Date PTIN Check if: Paid 3rd Party Designee Preparer Phone no Use Only Firm's name Self-employed Firm's address Firm's EIN Go to www.irs. gov/Form1040 for instructions and the latest information. Form 1040 (2019)