Interview Notes

Justin and his wife Jenna want to file a joint tax return.

They have a daughter Ava. Justin and Jenna have never taken a distribution from a retirement account

. Jenna has a Masters Degree in education. She works as a third grade teacher. She tells you that she paid $250 in 2017 for books and supplies used in her classroom.

During the interview, she mentions that she took a couple of college courses at the local community college to improve her job skills. She has a Form 1098-T and a $300 receipt from the bookstore for books she bought for class. The books are not required as a condition of enrollment

. Jenna has never claimed the Hope scholarship credit or the American opportunity credit.

Justin and Jenna purchased a home in July of last year and want to know if they have enough deductions to itemize. They give you receipts and statements for the following items they would like to deduct:

Unreimbursed doctor bills for Justin, Jenna and Ava for $1,200.

Unreimbursed prescription drugs for $200.

Health club dues for Jenna for $100.

A statement received from their church showing donations made throughout the year totaling $2,000.

Receipts for donations of furniture in good, used condition to Goodwill. The total estimated fair market value is $250.

$25 donated to a friend in need through a social networking site.

Form 1098 showing mortgage interest and real estate tax they paid.

$1,200 for homeowners insurance.

Union dues for Justin for $200.

Justin, Jenna and Ava were covered all year under a health care plan through Justins employer. The employer paid the entire premium.

Justin and Jenna used the standard deduction on last years federal income tax return. They received a refund of $160 on their 2016 state tax return. Using their states website, they confirmed that they received the refund on April 30, 2017.

They live in a state with no sales tax

26. Which of Justin and Jennas expenses are includible as itemized deductions on Schedule A? (Select all that apply)

a. Unreimbursed doctor bills for Jenna, Justin and, Ava for $1,200.

b. Unreimbursed prescription drugs for $200.

c. Health club dues of $100.

d. Real estate taxes of $4,150.

e. $25 donated to a friend.

27. Justin and Jenna had a state refund of $160. Should this amount be included on their tax return as income in 2017? a. Yes b. No

28. To compute the lifetime learning credit, which of Jennas expenses qualify? a. Course-related books b. Tuition c. Tuition and books d. No expenses can be claimed since Jenna already has her Masters Degree

29. What is the amount of Justin and Jennas earned income tax credit reported in the payments section on page 2 of their tax return? a. $0 b. $828 c. $836 d. $860

30. What is the total amount of Justin and Jennas adjustments to income on their Form 1040, line 36? a. $0 b. $15 c. $250 d. $265