Kyle (44 years old) and Elise (39 years old) Terry have four children. Kyle works for Lockheed Martin as a flight engineer and Elise is a freelance writer / editor. Their family is covered by a qualified High Deductible Health Insurance Plan. Kyle's gross pay is $120,000 and Elise's net earnings from self- employment is $75,000. Their children are Jacob (16), Katie (14), Rachael (12), and Luke (10). For the current tax year, Kyle and Elise prepared for retirement. Kyle's plan is a profit sharing plan and Elise utilizes a SEP IRA. Kyle's employer contributes 14% of his gross pay to the profit sharing plan. Kyle pays the health insurance premiums through his employer's cafeteria plan, his portion of the health insurance premiums are $7,000 per year. Kyle also incurred the following expenses during the year: $1,900 in student loan interest; $4,000 contribution to Utah's 529 plan ($1,000 for each child, Kyle lives in Georgia); State income taxes of $12,000; property taxes of $4,000; mortgage interest of $10,000; and $1,000 to their university alumni fund, and gave $300 worth of clothing to the Goodwill. Kyle and Elise also gave appreciated stock to their church. Kyle is an avid investor and purchased Apple stock for the equivalent of $5 per share. He and Elise donated 200 shares (basis $5/share, FMV at the time of gift $110/share) of Apple stock to their church