Mr. and Mrs. Hemming live with their family at 342 Magnolia Ave, Ashville NC 28801. Charles social security number is 434-11-3311; Marys is 456-87-5432. Charlie is 44 and Mary is 38. Both enjoy good health and eyesight. Charlie retired from the Air Force three years ago and then bought and operates a pet store. Mary is the office manager at city hall in Ashville.

1. The Hemmings have two children, a son named Nathan (social security number 598-01-2345), who is twelve years old, and a daughter named Alice (social security number 554-33-2411), who is eight years old.

2. For the current year, Marys W-2 from the City Hall showed the following:

Wages (Box 1) $25870

Wages (Box 3 & 5) $30480

Federal income tax withheld (Box 2) $4820

FICA/Medicare (Box 4 and 6) $2360

State income tax withheld (Box 17) $1560

PreTax Health Insurance Benefit (Box 12) $4610

3.Charlie's 1099-R form the air force showed the following:

Gross distribution $22365

Taxable distribution $22365

Federal income tax withheld $2680

State distribution $22365

State income tax withheld-NC $895

4.During the year, Charles' aunt Emma died. Emma had a $75k life insurance policy that named charlie as the beneficiary. Charles received the check for the benefit payable under the policy on October 10 of the current year. Emma also left Charles a small non-operating grape vineyard with an appraised value of $150k in California.

5.Charles and Mary had interest on an account held by second national bank of Nashville was $360 and interest income of $1500 on city of Nashville tax exempt bonds.

6.During the year, Charles and Mary received qualifying dividends:

Exxon $325

Coca Cola $290

Visa International $350

7.Charles' petstore is located at 185 Mission rd. ashville, NC 28801. The name of the store is "Four Pets Sake" and its taxID number is 26-9876556. The beginning and ending inventories were $12500 and $13k, respectively. The revenue and expenses for the year are as follows:

Sales $204200

Exp:

Cost of Sales $74k

Insurance $3k

Accounting fees $2400

Wages $36k

Payroll taxes $3120

Utilities $3k

Rental exp $18k

Telephone $900

Depreciation: Equipment $4200

Office expenses $400

Other expenses $1200

Total expenses $146220

Net income $57980

8.Charles and Mary own rental property at 431 Gary St. Marion NC 28752. The revenue and expenses for the year as as follows:

Rent income $13800

Insurance $550

Mortgage interest expense $6950

Property taxes $1100

Miscellaneous expenses $800

Depreciation (the house was acquired in 2000) $3090

9.When computing the qualified business income deduction, base this credit on the business plus the rental property income. you do not have to determine if the credit may be subject to limitation. Based on the facts provided I completed this step and there is no limitation. Can I g et help reflecting this on form 1040 to show this on line 9.

10.Mr. and Mrs. Hemming paid the following amounts during the year (all by check with the exception of Mrs. Hemmings health insurance which was payroll deduction):

Political contributions $300

Church donations with received written achnowledgement $7800

Real estate taxes on their home $2580

Mortgage interest for purchase of home $10800

Tax return preparation fees $90

Credit card interest $640

truck insurance premiums $1200

Computer training classes ar the local community college $1600

health insurance (pre tax) $4610

Doctors $980

Dentist $540

Prescriptions $280

11.Mrs. Hemming is an active participate in the retirement plan at her job and Mr. Hemming is not covered by a retirement plan because he is self-semploye. Mr. Hemming contributed the max for himself to a traditional IRA for 2020.

12.Mr. Hemming made estimated federal income tax payments of $7600 and estimated state income tax payments of $2200 during the current year.

13.When considering the lifetime learning credit for continuing education, you do not have to complete the form 886. This household qualified for the credit based on the facts provided in the problem.

14.Mr. Hemming likes to invest in the stock market. During the year he sold the following securities and a 1099B was issued to the IRS showing the basis. Mr. Hemmingreceived 1099-B documents for these sales but only the Brown Co. Stock showed the cost basis:

(Stock 1)Green Co. (date acquired) 2/11/10 (date sold) 8/15/20 (sales price) $5200 (Cost Basis) $2800

(stock 2)Brown Co. (date acquired) 1/31/20 (date sold) 6/05/20 (sales price) $6300 (cost basis) $5300

(stock 3)Orange Co. (date acquired) 10/02/12 (date sold)10/07/20 (sales price) $8200 (cost basis) $1600

The expenses of the sale are included in the cost basis. Charles has a long-term capital loss carryover from last year of $3400.

15.The Hemmings received $3400 for the first economic stimulus payment and $2400 for the 2nd in 2020.

REQUIRED: Mr. and Mrs. Hemming need help to prepare their 2020 Federal income tax return. Do not complete the NC state income tax return. Assume any other information (address, etc.) needed. Do not file the federal Form 4562, 8812, 8829, or 8863. 4562 form is also not needed for the rental property. The following is a list of Forms, Schedules, and worksheets I need help to fill in using the information above....

Form 1040

Form 1040 Schedule 1-3

Schedule A,C,D,E,SE

Form 2441

Form 8949

Qualified Dividends and Capital Gain Worksheet

2020 Child tax credit worksheet

*I know the IRS updates forms around the mid-October mark and that is probably going to affect things.