John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter Samantha. In 2021, John worked as a computer technician at a local university earning a salary of $152,000, and Sandy worked part-time as a receptionist for a law firm earning a salary of $29,000. The Fergusons received $800 in qualified dividends and a $200 refund of their state income taxes. The Fergusons always itemize their deductions and their itemized deductions were well over the standard deduction amount last year ($28,800). The Fergusons did not receive an advanced payment for the 2021 individual recovery credit, nor did they receive any advanced child tax credit payments.

The Fergusons reported making the following payments during the year:

• State income taxes of $4,400. Federal tax withholding of $21,000.
• Alimony payments to Johns former wife $8,000 (divorced in 2012
• Child support payments for Johns child with his former wife $4,100.
• $12,200 of real property taxes.
• Sandy was reimbursed $600 for employee business expenses she incurred. She was required to provide documentation for her expenses to her employer.
• $3,600 to Kid Care daycare center for Samanthas care while John and Sandy worked (Kids Care Daycare EIN 88-7773461).
• $14,000 interest on their home mortgage (acquisition debt of $400,000)
• $3,000 interest on a $40,000 home-equity loan. They used the loan to pay for family vacation and new car.
• $15,000 cash charitable contributions to qualified charities (proper documentation exists).
• Donation of used furniture to Goodwill. The furniture had a fair market value of $400 and cost $2,000.