Instructions

Please complete the 2021 Federal Income Tax Return using the attached information. For this tax return, you will need form 1040, Line 5 Worksheet, Credit Limit Worksheet A, Schedule 1, Schedule B, Schedule E page 2, Schedule 8812, and Schedule 8995. 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. The forms, schedules, and instructions can be found at the IRS website (www.irs.gov). The instructions can be helpful in completing the forms.

Sarah Hamblin and her now ex-husband Kevin were legally divorced on March 1, 2021. As of the end of the year, Sarah was unmarried. Sarah and Kevin had only one child, an 11-year-old girl named Elizabeth. As part of the divorce decree, Sarah was given custody of Elizabeth and Kevin was required to pay 1) child support for Elizabeths care, and 2) alimony to Sarah until she remarries or dies. Because Kevin will be making child support payments, the divorce decree provided that Kevin will be permitted to claim the tax dependency exemption for Elizabeth until Elizabeth no longer qualifies as a tax dependent of either parent and the decree obligates Sarah to sign and/or file any required forms to cause this result to occur.

Sarah rents a home (separate from Kevin) that she pays for herself. Elizabeth lives with Sarah most of the time, but she visits and stays with her father every other weekend and most holidays. During the year, Elizabeth stayed at Kevins house a total of 74 nights.

Sarah provided the following information for 2021:

Sarahs Social Security number is 123-43-4321

Elizabeths Social Security number is 123-34-1234

Sarahs mailing address is 1245 Rose Petal Drive, Middletown, Wisconsin 53562

Elizabeth is a U.S. citizen

The following was reported on Sarahs Form W-2:

Employer	Gross Wages	Federal Income Tax Withholding	State Income Tax Withholding
Central Wisconsin Heating and Air	34,350	6,950	2,125

All applicable and appropriate payroll taxes were withheld by the employer.

During the year, Sarah also received the following:

Child Support Payment from Kevin Hamblin $12,000

Alimony Payment from Kevin Hamblin $16,000

Gift from her father to help with legal bills $ 8,500

Interest income on U.S. Treasury Bond $ 400

Interest income of Madison City Bond (municipal bond) $ 250

Interest income from First Bank of Madison $ 165

Life insurance proceeds on the death of her mother $45,000

Sarah made a $200 donation to the American Red Cross in support of its COVID-19 relief efforts.

Sarah is a 50% owner in a friends company, Bright Day Flowers, Inc. Bright Day Flowers, Inc. (BDF) is a Subchapter S corporation. The company reported ordinary business income for the year of $22,000. Sarah acquired the stock several years ago. Sarah worked a total of 600 hours at the BDF shop in the evenings and on the weekends during 2021. Bright Day Flowers, Inc.s employer identification number is 56-3535353.

Sarah entered a contest sponsored by a radio station and won 10 gift cards to various restaurants. The value of the gift cards was $200 each. Sarah gave several of the gift cards away to her coworkers.

Sarah lost her job with Central Wisconsin Heating and Air on November 15 because of a reduction in work force. She collected $1,250 in unemployment benefits during the year. She is currently looking for another job.

Sarah had qualifying minimum health insurance coverage provided to her because of her employment with Central Wisconsin Heating and Air for each month in 2021 (the employer continued to cover her through the end of the year). Elizabeth had qualifying minimum health insurance coverage provided through Kevin through his work.

Sarah did not own, control or manage any foreign bank accounts nor was she a grantor or beneficiary of a foreign trust during the tax year. Also, Sarah did not buy, sell, exchange, or otherwise acquire any financial interest in a virtual currency.

Sarah received her Economic Impact Payment (stimulus check) in the full amount before filing her 2021 tax return. Sarah did not receive any Advance Child Tax Credit payments in 2021.

Sarah was provided with the following benefits as part of her employment:

Group-term life insurance coverage of $50,000. The cost to cover Sarah for the company for the tax year is $150.

Access to the company photocopy machine. Sarah estimates she made $14 worth of copies during the year primarily for use with her church group activities.

Sarah reported no itemized deductions other than any described above.

Sarah does not want to contribute to the Presidential Election Campaign Fund. She would like to receive a refund (if any) of any tax she may have overpaid for the year. Her preferred method of receiving the refund is by check.

Schedule B812 (Form 1040) 2021 Pege 2 Part I-C Filers Who Do Not Check a Box on Line 13 Caution: If you checked a box on line 13, do not complete Part I-C. 15a Enter the amount from the Credit Limit Worksheet A b Enter the smaller of line 12 or line 15a Additional child tax credit. Complete Parts II-A through II-C if you meet each of the following items. 1. You are not filing Form 2555. 2. Line 4a is more than zero. 3. Line 12 is more than line 15a. c If you completed Parts II-A through II-C, enter the amount from line 27; otherwise, enter -0- d Add lines 15b and 15c e Enter the aggregate amount of advance child tax credit payments you (and your spouse if filing jointly) received for 2021. See your Letter(s) 6419 for the amounts to include on this line. If you are missing Letter 6419 , see the instructions before entering an amount on this line. If you didn't receive any advance child tax credit payments for 2021 , enter -0 - Caution: If the amount on this line doesn't match the aggregate amounts reported to you (and your spouse if filing jointly) on your Letter(s) 6419 , the processing of your return will be delayed. f Subtract line 15e from line 15d. If zero or less, enter -0 - on lines 15f through 15h and go to Part III . . . . g Enter the smaller of line 15b or line 15f. This is your nonrefundable child tax credit and credit for other dependents. Enter this amount on line 19 of your Form 1040, 1040-SR, or 1040-NR. h Subtract line 15g from line 15f. This is your additional child tax credit. Enter this amount on line 28 of your Form 1040, 1040-SR, or 1040-NR Part II-A Additional Child Tax Credit (use only if completing Part I-C) Caution: If you file Form 2555, do not complete Parts II-A through II-C; you cannot claim the additional child tax credit. Caution: If you checked a box on line 13, do not complete Parts II-A through II-C; you cannot claim the additional child tax credit. Yes. If line 20 is equal to or more than line 17, skip Part II-B and enter the amount from line 17 on line 27. Otherwise, go to line 21 . Part II-B Certain Filers Who Have Three or More Qualifying Children 21 Withheld social security, Medicare, and Additional Medicare taxes from Form(s) W-2, boxes 4 and 6 . If married filing jointly, include your spouse's amounts with yours. If your employer withheld or you paid Additional Medicare Tax or tier I RRTA taxes, see instructions 22 Enter the total of the amounts from Schedule 1 (Form 1040), line 15; Schedule 2 (Form 1040), line 5; Schedule 2 (Form 1040), line 6; and Schedule 2 (Form 1040), line 13. 23 Add lines 21 and 22 . 241040 and 1040-SR filers: Enter the total of the amounts from Form 1040 or 1040-SR, line 27a, and Schedule 3 (Form 1040), line 11. 1040-NR filers: Enter the amount from Schedule 3 (Form 1040), line 11. 25 Subtract line 24 from line 23 . If zero or less, enter -0 - 26 Enter the larger of line 20 or line 25. Next, enter the smaller of line 17 or line 26 on line 27. Part II-C Additional Child Tax Credit Schedule Be12 (Form 1040) 2021 Page 3 Part III Additional Tax (use only if line 14g or line 15f, whichever applies, is zero) 28 anter the amount from line 14f or line 15e, whichever applies b Enter the amount from line 14e or line 15d, whichever applies 29 Excess advance child tax credit payments. Subtract line 28b from line 28 . If zero, stop; you do not owe the additional tax . 30 Enter the number of qualifying children taken into account in determining the annual advance amount you received for 2021. See your Letter 6419 for this number. If you are missing your Letter 6419 , you are filing a joint return, or you received more than one Letter 6419 , see the instructions before entering a number on this line .. Caution: If the amount on this line doesn't match the number of qualifying children reported to you (and your spouse if filing jointly) on your Letter(s) 6419 , the processing of your retum will be delayed. 31 Enter the smaller of line 4a or line 30 . . 32 Subtract line 31 from line 30 . If zero, skip to line 40 and enter the amount from line 29 ; otherwise, continue to line 33 33 Enter the amount shown below for your filing status. -MarriedfilingjointlyorQualifyingwidow(er)-$60,000-Headofhousehold-$50,000-Allotherfilingstatuses-$40,000 34 Subtract line 33 from line 3 . If zero or less, enter -0 - 35 Enter the amount from line 33. 36 Divide line 34 by line 35 . Enter the result as a decimal (rounded to at least three places). If the result is 1.000 or more, enter 1.000 . 37 Multiply line 32 by $2,000. 38 Multiply line 37 by line 36 . 39 Subtract line 38 from line 37 40 Subtract line 39 from line 29 . If zero or less, enter -0 -. This is your additional tax. If more than zero, enter this amount on Schedule 2 (Form 1040), line 19 . \begin{tabular}{|l|l} \hline 28a & \\ \hline 28b & \\ \hline 29 & \\ \hline & \\ \hline 30 & \\ \hline & \\ \hline 31 & \\ \hline 32 & \\ \hline & \\ \hline 33 & \\ \hline 34 & \\ \hline 35 & \\ \hline 36 & \\ \hline 37 & \\ \hline 38 & \\ \hline 39 & \\ \hline & \\ \hline 40 & \\ \hline \end{tabular} Schedule 8812 (Form 1040) 2021