Kelly and Chanelle Chambers, ages $47$ and $45,$ are married and live at $584$ Thoreau Drive,

Boston, MA $59483.$ Kelly$$s Social Security number is $111-11-1111$ and Chanelle$$s 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 Emma$$s and Chet$$s 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, Chanelle$$s gross revenues were $$23,000.$ She incurred the following ex$-$penses in her business:

Liability insurance $ $700$

Software rental $5,400$

Journals and magazines $150$

Training seminars $1,200$

Supplies $1,300$

Donations to a political campaign fund $800$ y enjoys playing guitar and plays in a band. Kelly$$s 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 $$1,300$

Sound system repairs $200$

CD production $500$

New guitar and amplifier $800$

Kelly$$s father passed away during the year. Kelly and Chanelle received $$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.

Chet$$s physician recommended that he see a physical therapist to help with his dis$-$ability. Kelly paid the therapist $$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 $$1,400$

Property taxes on car $($determined by value$)500$

Home mortgage interest $12,000$

Credit card finance charges $2,600$

Tax return preparation fees $($$$600$ is allocable to Chanelle$$s business$)1,000$

Sales tax on purchases during the year $6,200$

Interest from a savings account $800$

Interest from City of Boston Bonds $700$

Dividend from $3$M stock $400$

Prepare Kelly and Chanelle$$s tax return Form $1040$ and Schedules A$,$ B$,$ C$,$ D$,$ and SE for $2022$