Ken is 63 years old and unmarried. He retired at age 55 when he sold his business, and he files as a single tax payer.

1. He won $1,200 in an illegal game of poker.

2. He sold 1,000 shares of stock at $32 a share (he inherited the stock two years ago and his tax basis or investment was $31 per share).

3. He received $25,000 from an annuity he purchased eight years ago (the annuity was $210,000 and was to be paid annually for 20 years).

4. He received $13,000 in disability benefits for the year (he purchased the policy last year).

5. He received a $500 cash scholarship to go back to school (used $300 for tuition and the rest for a car note).

6. His son gave him half of his paycheck ($1,100 made payable to him, received on 12/30) as a gift.

7. He received a $610 refund of the $3,600 in state income taxes withheld last year (he claimed $12,050 in itemized deductions last year when st. deduc. was $12,000).

8. He received $30,000 in interest from corporate bonds and money market accounts.

Form 1040 and Schedule 1

. Required information 1 1 Wages, salaries, psoto Altach Form(s) W2 2a 2b 2a Tax-exempt interest 3b 3a Qualified dividends 3 3 Taxable interest Attach Sch Bil required b Ordinary dividends. Attach Sch Bif required b Taxable amount d Taxable amount 4b 4 IRA distributions 4d de b Taxable amount 6 7b 0 fla Pensions and annuities 5a Social security benefits 6 Capital gain or loss). Attach Schedule Dit required. If not required, check here 7a Other income from Scheidule 1, line 9 Add lines 1, 25, 36, 40, 4, 5, 6, and 7a This is your total income Ba Adjustments to income from Schedule 1, line 22 Subtractie la mine 7 This is your adjusted gross income Standard deduction or itemized deductions (trom schedule A) 10 Osthed business income deduction Altach Form 100 or Form 1005A 11 Adds and 10 bo Taxable income, Stradline 11a from line 6 Bb 10 115 2