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Kelly and Chanelle Chambers, ages 4 7 and 4 5 , are married and live at 5 8 4 Thoreau Drive, Boston, MA 5 9

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Kelly and Chanelle Chambers, ages 47 and 45, are married and live at 584 Thoreau Drive, Boston, MA 59483. Kellys Social Security number is 111-11-1111 and Chanelles is 222-22-2222. The Chambers have two children: Emma, age 23, and Chet, age 19. Their Social Security numbers are 333-33-3333 and 444-44-4444, respectively. Emma is a single college student and earned $8,000 during the summer. Kelly and Chanelle help Emma through school by paying for her room, board, and tuition. Emma lives at home during the summer. Chet has a physical handicap and lives at home. He attends a local university and earned $4,000 working for a marketing firm. In sum, Kelly and Chanelle provide more than 50% of both Emmas and Chets total support for the year. Kelly is a commercial pilot for a small airline. His salary is $95,000, from which $19,000 of federal income tax and $8,000 of state income tax were withheld. Kelly also pays premiums for health, disability, and life insurance. $2,000 of the premium was for health insurance, $250 for disability, and $400 for life insurance. Chanelle owns Alliance Networks, a proprietorship that does network consulting. During the year, Chanelles gross revenues were $23,000. She incurred the following ex-penses in her business:Liability insurance - $700Software rental -5400Journals and magazines -150Training seminars -1200Supplies -1300Donations to a political campaign fund -800Kelly enjoys playing guitar and plays in a band. Kellys band has developed a local following. This year, his gross revenues were $1,200 for playing shows and $700 on CD sales. He incurred the following expenses:Studio rent expense -1300Sound system repairs -200CD production -500New guitar and amplifier -800Kellys father passed away during the year. Kelly and Chanelle received $100,000 from the life insurance policy. Neither Kelly nor Chanelle paid any of the premiums. Chanelle purchased 100 shares of Thurston Co. stock on May 1,1993, for $1,000. Thurston Co. was declared bankrupt during the current year. Chets physician recommended that he see a physical therapist to help with his dis-ability. Kelly paid the therapist $7,000 during the year because his insurance would not cover the bills.Kelly and Chanelle went to Las Vegas and won $5,000 at the blackjack table. The next night, they lost $6,000.Kelly and Chanelle gave $900 to their church and, during the year, they had the fol-lowing other income and expenses:Real estate taxes -1400Property taxes on car (determined by value)-500Home mortgage interest -12,000Credit card finance charges -2600Tax return preparation fees ($600 is allocable to Chanelles business)-1,000Sales tax on purchases during the year -6200Interest from a savings account -800Interest from City of Boston Bonds -700Dividend from 3M stock -400
Prepare Kelly and Chanelles tax return Form 1040 and Schedules A, B, C, D, and SE for 2022. Assume the couple had no transactions involving virtual currency.
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