Noah and Joan Arc's Tax Return

Note: This problem is divided into three parts. You will need to complete some of the forms in the other parts in order to determine the amounts that are used on Form 1040.

Noah and Joan Arc live with their family at 4342 Josie Jo, Santee, CA 92071. Noah's Social Security number is 434-11-3311; Joan's is 456-87-5432. Both are in their mid-30s and enjoy good health and eyesight. Noah owns and operates a pet store and Joan is a firefighter for the city.

1. The Arcs have two children, a son named Billie Bob (Social Security number 598-01-2345), who is 7 years old, and a daughter named Mary Sue (Social Security number 554-33-2411), who is 4 years old. The Arcs paid $3,200 to the Roundup Day Care Center to take care of Mary Sue while they worked. Because Joan is a firefighter, she was home in the afternoon to care for Billie Bob after school.

2. For the current year, Joan's W-2 from the city fire department is located below. Noah made estimated federal income tax payments of $12,000 and estimated state income tax payments of $1,020 during the current year.

2017/01/22 3:02 1. Comprehensive Problem 1 - Part 1 Noah and Joan Arc's Tax Return Note: This problem is divided into three parts. You will need to complete some of the forms in the other parts in order to determine the amounts that are used on Form 1040. Noah and Joan Arc live with their family at 4342 Josie Jo, Santee, CA 92071. Noah's Social Security number is 434-11-3311; Joan's is 456-87-5432. Both are in their mid-30s and enjoy good health and eyesight. Noah owns and operates a pet store and Joan is a firefighter for the city. 1. The Arcs have two children, a son named Billie Bob (Social Security number 598-01-2345), who is 7 years old, and a daughter named Mary Sue (Social Security number 554-33-2411), who is 4 years old. The Arcs paid $3,200 to the Roundup Day Care Center to take care of Mary Sue while they worked. Because Joan is a firefighter, she was home in the afternoon to care for Billie Bob after school. 2. For the current year, Joan's W-2 from the city fire department is located below. Noah made estimated federal income tax payments of $12,000 and estimated state income tax payments of $1,020 during the current year. a Employee's social security number 456-87-5432 OMB No. 1545-0008 b Employer identification number (EIN) Safe, accurate, IRS FAST! Use e ~ file Visit the IRS website at www.irs.gov/efile 1 Wages, tips, other compensation 33-4382966 2 Federal income tax 27,600.00 withheld 5,050.00 c Employer's name, address, and ZIP code 3 Social security wages Santee Fire Department 4 Social security tax withheld 27,600.00 Santee, CA 92071 1,711.20 5 Medicare wages and tips 6 Medicare tax withheld 27,600.00 400.20 7 Social security tips d Control number e Employee's first name and initial 8 Allocated tips 9 Last 10 Dependent care benefits Suff. 11 Nonqualified plans 12a See instructions for box 12 name C o d e Joan Arc 13 Statutory 4342 Josie Jo Retirement Third-party sick employee plan pay 12b Santee, CA 92071 C o d e 14 Other 12c C o d e 12d C o d e f Employee's address and ZIP code 15 State Employer's state ID number 16 State wages, tips, etc. 17 State income tax 18 Local wages, tips, etc. 19 Local income 20 Locality tax http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 name Page 1 of 9 2017/01/22 3:02 CA Form 1126-87021 27,600.00 W-2 Wage and Tax Statement 1,240.00 2015 Department of the TreasuryInternal Revenue Service Copy BTo Be Filed With Employee's FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service. 3. Noah's pet store is located at 18542 Mission Road, Santee, CA 92071. The name of the store is ''The Arc,'' and its taxpayer ID number is 959876556. The beginning inventories and ending inventories are both $10,000. The revenue and expenses for the year are as follows: Sales revenue (merchant card sales) $ 144,300 Expenses: Cost of sales $61,900 Insurance 780 Accounting fees 1,800 Wages 25,100 Payroll taxes 2,250 Business meals (total) $400 Utilities 2,650 Rental expense 7,600 4. Noah and Joan paid the following amounts during the year (all by check): Political contributions $250 Church donations (for which a written acknowledgment was received) 2,700 Real estate taxes on their home 1,350 Mortgage interest for purchase of home See Form 1098 Tax return preparation fees 350 Credit card interest 220 Automobile insurance premiums 600 Uniforms for Joan 125 5. Noah likes to invest in the stock market. His Form 1099-B showed the following information for Noah's stock sales: Stock Date Acquired Date Sold Sales Price Cost Basis Blue Co. 02/11/05 08/15/15 $4,500 $2,400 Yellow Co. 01/31/15 Red Co. 10/02/06 06/05/15 6,000 5,300 10/07/15 12,200 1,600 The expenses of sale are included in the cost basis. Noah has a long-term capital loss carryover from last year of $2,350. 6. During the year, Noah and Joan received the following qualifying dividends: Exxon $302 Texas Utilities Coca-Cola 220 See 1099-DIV All stocks, bonds, and savings accounts were purchased or established with community property. 7. Noah and Joan own rental property (a single family residence) located at 6431 Gary Ct., San Diego, CA 92115. The revenue and expenses for the year are as follows: Rent income Insurance See 1099-MISC $575 Interest expense 6,870 Property taxes 1,000 Miscellaneous expenses Depreciation (the house was acquired in 1991) 600 3,000 8. All members of the Arc household were covered for the entire year under health care insurance through Joan's employer. Required: Although Noah and Joan do not believe their tax return will be unduly complicated, they do realize their limitations and come to you for assistance. You are to prepare their federal income tax return in good form, signing the return as the preparer. You are not required to complete a California state income tax return. Noah and Joan have completed a tax organizer and have also given you several IRS forms (see 1099-DIV, 1099- http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 2 of 9 2017/01/22 3:02 MISC and 1098) that they were not sure what to do with. Make realistic assumptions about any missing data (addresses, etc.) that you may need. The following forms and schedules are required: Form 1040 Schedule E Schedule A Schedule SE Schedule B Form 2441 Schedule C Form 8949 Schedule D Qualified Dividends and Capital Gain Tax Worksheet Note: Only page 1 of Schedule E is required. Click here to access the tax table to use for this problem. If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers. If an amount box does not require an entry or the answer is zero, enter "0". If required, round your answers to the nearest dollar. However, on Schedule SE, use the rounded amounts in subsequent computations. Department of the TreasuryInternal Revenue Service Form (99) 1040 U.S. Individual Income Tax Return 2015 OMB No. 1545-0074 IRS use only For the year Jan. 1-Dec. 31, 2015, or other tax year ,2015, ending beginning See separate instructions. ,20 Your first name and initial Last name Noah Arc If a joint return, spouse's first Your social security number 434-11-3311 Last name name and initial Spouse's social security number Arc Joan 456-87-5432 Home address (number and street). If you have a P.O. box, see instructions. Make sure the SSN(s) above and on line 6c are correct. Apt. no. 4342 Josie Jo City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below (see instructions). Presidential Election Campaign Santee, CA 92071 Check here if you, or your spouse if filing jointly, want $3 to go to this Foreign Foreign country name Foreign fund. Checking a box below will not change your tax or refund. province/state/country postal code You Spouse Filing status Exemptions Yourself. If someone can claim you as a dependent, do not 6a check box 6a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . b Spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . If more than four First Last name name (2) (3) Dependent's Dependent's social security relationship number to you No. of children on 6c (4) If child under age 17 qualifying for child tax credit (see instructions) lived with you did not live with you due to divorce or separation (see instructions) Billie Bob Arc 598-01-2345 Son Mary Sue Arc 554-33-2411 Daughter Dependents on 6c not entered above dependents, see instructions and check here } and 6b who: c Dependents: (1) Boxes checked on 6a d Total number of exemptions claimed . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 7 Add numbers on lines above Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 7 Taxable interest. Attach Schedule B if required . . . . . . . . . . . . . . . . . . . . . . . . . . http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 3 of 9 2017/01/22 3:02 8a . . . . . 8a b Tax-exempt interest. Do not include on line 8a . . . . . . . . . 9a ..... b Qualified dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 11 12 Income Attach Form(s) W-2 here. Also attach 13 14 8b Ordinary dividends. Attach Schedule B if required . . . . . . . . . . . . . . . . . . . . . . . . . 9b Taxable refunds, credits, or offsets of state and local income taxes . . . . . . . . . . . . . ... Alimony received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... Business income or (loss). Attach Schedule C or C-EZ . . . . . . . . . . . . . . . . . . . . . . ..... Capital gain or (loss). Attach Schedule D if required. If not required, check here Other gains or (losses). Attach Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... Forms W-2G and 1099-R if tax was withheld. 9a 10 11 12 13 14 Taxable 15a IRA distributions . . . . . . . . . . . 15a b amount . 15b . If you did not get a W-2, see instructions. Taxable 16a Pensions and annuities . . . . . . 16a b amount . 16b . 17 18 19 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach 17 Schedule E Farm income or (loss). Attach Schedule F . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... Unemployment compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... 18 19 Taxable 20a Social security benefits 20a b amount . 20b . 21 21 Other income. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Combine the amounts in the far right column for lines 7 through 21. This is your 22 total income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............. 23 24 Adjusted Gross Income Educator expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 23 Certain business expenses of reservists, performing artists, and feebasis government officials. Attach Form 2106 or 2106-EZ . 24 25 Health savings account deduction. Attach Form 8889 . . . . . 25 26 Moving expenses. Attach Form 3903 . . . . . . . . . . . . . . . . . . 26 27 Deductible part of self-employment tax. Attach Schedule SE 27 28 Self-employed SEP, SIMPLE, and qualified plans . . . . . . . . . 28 29 Self-employed health insurance deduction . . . . . . . . . . . . . 29 30 Penalty on early withdrawal of savings . . . . . . . . . . . . . . . . 30 31a Alimony paid b Recipient's SSN 31a 32 IRA deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 33 Student loan interest deduction . . . . . . . . . . . . . . . . . . . . . 33 34 Tuition and fees. Attach Form 8917 . . . . . . . . . . . . . . . . . . . 34 35 Domestic production activities deduction. Attach Form 8903 35 36 37 Add lines 23 through 35 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... Subtract line 36 from line 22. This is your adjusted gross income . . . . . . . . . . ... 36 37 For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2015) http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 4 of 9 2017/01/22 3:02 Form 1040 (2015) Noah & Joan Arc 434-11-3311 Page 2 38 Amount from line 37 (adjusted gross income) . . . . . . . . . . . . . . . . . . . . . . . . . ......... You were born before January 2, 1951, 39a Check if: Blind. { Spouse was born before January 2, 1951, Tax and Credits Blind. 38 Total boxes } checked 39a If your spouse itemizes on a separate return or you were a dual-status alien, b check here 39b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............. 40 41 Itemized deductions (from Schedule A) or your standard deduction (see left margin) Subtract line 40 from line 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 41 ......... Exemptions. If line 38 is $154,950 or less, multiply $4,000 by the number on 42 line 6d. Otherwise, see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 ............... 43 44 Standard Deduction for 45 People who check any box on line 39a or 39b or who can be claimed as a dependent, 46 see instructions. All others: Single or Married filing separately, $6,300 Married filing jointly or Qualifying widow(er), $12,600 Head of household, $9,250 47 48 49 50 51 52 53 Taxable income. Subtract line 42 from line 41. If line 42 is more than line 41, Tax (see instructions). Check if any from: a Form(s) 8814 b Form 4972 c 56 57 58 59 60a Other Taxes b 61 44 Alternative minimum tax (see instructions). Attach Form 6251 . . . . . . . . . 45 ........ Excess advance premium tax credit repayment. Attach Form 8962 . . . . . . . . 46 ....... Add lines 44, 45, and 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... Foreign tax credit. Attach Form 1116 if required . . . . . . . . . ... 47 48 Credit for child and dependent care expenses. Attach Form 49 2441 Education credits from Form 8863, line 19 . . . . . . . . . . . . . .... Retirement savings contributions credit. Attach Form 8880 . ... Child tax credit. Attach Schedule 8812, if required . . . . . . . ... Residential energy credit. Attach Form 5695 . . . . . . . . . . . ... 54 Other credits from Form: a 3800 55 43 enter -0- b 8801 c 50 51 52 53 54 Add lines 48 through 54. These are your total credits . . . . . . . . . . . . . . . . . . .......... Subtract line 55 from line 47. If line 55 is more than line 47, enter -0- . . . . . . ...... 56 Self-employment tax. Attach Schedule SE . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... Unreported social security and Medicare tax from Form: a 4137 b 8919 . . . ....... Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required Household employment taxes from Schedule H . . . . . . . . . . . . . . . . . . . . . . . . ........ First-time homebuyer credit repayment. Attach Form 5405 if required . . . . . . . . ....... Health care: individual responsibility (see instructions) Full-year coverage 55 57 58 59 60a 60b 61 Taxes from: a Form 8959 b Form 8960 c Instructions; enter code(s) _ _ _ http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 5 of 9 2017/01/22 3:02 62 ____ Add lines 56 through 62. This is your total tax . . . . . . . . . . . . . . . . . . . . . . 63 Payments ........ 64 Federal income tax withheld from Forms W-2 and 1099 . . . . . . .. 66a 66b Nontaxable combat pay election . . . . 67 68 68 American opportunity credit from Form 8863, line 8 . . . . . . . . . . Net premium tax credit. Attach Form 8962 . . . . . . . . . . . . . . . . . .. 69 70 Amount paid with request for extension to file . . . . . . . . . . . . . 70 71 Excess social security and tier 1 RRTA tax withheld . . . . . . . . . . 71 72 Credit for federal tax on fuels. Attach Form 4136 . . . . . . . . . . . 72 73 Credits from Form: a 2439 b Reserved c 8885 d 73 74 75 65 Earned income credit (EIC) . . . . . . . . . . . . . . . . . . . . . . . . . 67 Additional child tax credit. Attach Schedule 8812 . . . . . . . . . . . . 69 Refund 64 return If you have a qualifying child, attach Schedule 66a b Add lines 64, 65, 66a, and 67 through 73. These are your total payments . . . ..... If line 74 is more than line 63, subtract line 63 from line 74. This is the amount you overpaid instructions. b Routing number 74 75 76a 76a Amount of line 75 you want refunded to you. If Form 8888 is attached, check here Direct deposit? See 63 2015 estimated tax payments and amount applied from 2014 65 EIC. 62 c Type: Checking Savings d Account number 77 Amount 78 You Owe 79 Amount of line 75 you want applied to your 2016 estimated tax 77 Amount you owe. Subtract line 74 from line 63. For details on how to pay, see instructions . . . . . . . . . 78 .............................................. Estimated tax penalty (see instructions) . . . . . . . . . . . . . . . . . . . . . 79 Do you want to allow another person to discuss this return with the IRS (see instructions)? Yes. Complete below. Third Party No Designee's Designee Phone name Personal identification no. number (PIN) Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than Sign Here taxpayer) is based on all information of which preparer has any knowledge. Your Your signature Joint return? See instructions. Keep a copy for your records. Date Noah Arc occupation Pet Store Daytime phone number Owner Spouse's signature. If a joint return, both must sign. Spouse's Date occupation Joan Arc If the IRS sent you an Identity Protection PIN, enter it here (see inst.) Firefighter Print/Type preparer's name Preparer's signature Date Check if self-employed PTIN Paid Preparer Use Only Firm's name Firm's EIN Firm's address Phone no. www.irs.gov/form1040 SCHEDULE A (Form 1040) Form 1040 (2015) Itemized Deductions Information about Schedule A and its separate instructions is at OMB No. 15450074 2015 Department of the Treasury Internal Revenue www.irs.gov/schedulea. Attachment Service (99) Attach to Form 1040. Sequence No. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 6 of 9 2017/01/22 3:02 07 Your social Name(s) shown on Form 1040 security Noah and Joan Arc number 434-113311 Caution. Do not include expenses reimbursed or paid by others. Medical and Dental Expenses 1 Medical and dental expenses (see instructions) . . . . . . . . . . . . . . 2 2 Enter amount from Form 1040, line 38 3 1 Multiply line 2 by 10% (.10). But if either you or your spouse was born before January 2, 1951, multiply line 2 by 7.5% (.075) instead 3 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- . . . . . . . . . . . . . . . . . . . 4 5 State and local a Income taxes b General Sales Taxes Taxes You Paid } ......................... 5 6 Real estate taxes (see instructions) . . . . . . . . . . . . . . . . . . . . . . . 6 7 Personal property taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 8 Other taxes. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ __________________________________ 8 9 Add lines 5 through 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Home mortgage interest and points reported to you on Form 1098 9 10 Home mortgage interest not reported to you on Form 1098. If paid to the person from Interest You Paid 11 whom you bought the home, see instructions and show that person's name, identifying no., and address _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __________________________________ Note. Your mortgage interest deduction may be limited (see instructions). 12 11 Points not reported to you on Form 1098. See instructions for special rules . . . . . . . . . . . . 12 .......................... 13 Mortgage insurance premiums (see instructions) . . . . . . . . . . . . . 13 14 Investment interest. Attach Form 4952 if required. (See instructions.) 14 15 Add lines 10 through 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gifts to Charity If you made a gift and got a benefit for it, see instructions. 16 17 15 Gifts by cash or check. If you made any gift of $250 or more, see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Other than by cash or check. If any gift of $250 or more, see instructions. You must attach 17 Form 8283 if over $500 . . . . . . . . . 18 Carryover from prior year . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 19 Add lines 16 through 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 20 Casualty or theft loss(es). Attach Form 4684. (See instructions.) 20 Casualty and Theft Losses Unreimbursed employee expensesjob travel, union dues, job education, etc. Attach Form 21 2106 or 2106-EZ if required. (See instructions.) Employee Business Expenses 21 22 Tax preparation fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Job Expenses and Certain Miscellaneous Deductions 23 22 Other expensesinvestment, safe deposit box, etc. List type and amount _ _ _ _ _ _ _ _ ____________________ __________________________________ 24 Add lines 21 through 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Enter amount from Form 1040, line 38 23 24 25 26 Multiply line 25 by 2% (.02) . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 27 Subtract line 26 from line 24. If line 26 is more than line 24, enter -0- . . . . . . . . . . . . . . . . . http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 27 Page 7 of 9 2017/01/22 3:02 Other Miscellaneous 28 Otherfrom list in instructions. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _________________________________________ Deductions 28 29 Is Form 1040, line 38, over $154,950? No. Your deduction is not limited. Add the amounts in the far right column for lines 4 through Total Itemized 28. Also, enter this amount on Form 1040, line 40. Yes. Your deduction may be limited. See the Itemized Deductions Worksheet in the Deductions 30 } . . . . 29 .. instructions to figure the amount to enter. If you elect to itemize deductions even though they are less than your standard deduction, check here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . For Paperwork Reduction Act Notice, see Form 1040 instructions. Cat. No. 17145C Schedule A (Form 1040) 2015 Interest and Ordinary Dividends SCHEDULE B OMB No. 15450074 2015 (Form 1040A or 1040) Department of the Treasury Internal Revenue Service (99) Attach to Form 1040A or 1040. Information about Schedule B and its instructions is at www.irs.gov/scheduleb. Attachment Sequence No. 08 Your social Name(s) shown on return security Noah and Joan Arc number 434-113311 List name of payer. If any interest is from a seller-financed mortgage and Amount the buyer used the property as a personal residence, see instructions on 1 back and list this interest first. Also, show that buyer's social security number and address Part I Interest (See instructions on back and the instructions for Form 1040A, or Form 1040, line 8a.) 1 2 Note: If you received a Form 1099-INT, Form 1099-OID, or substitute statement from a brokerage firm, list the Add the amounts on line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... 2 Excludable interest on series EE and I U.S. savings bonds issued after 3 1989. Attach Form 8815 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . firm's name as the payer and enter the total interest ........... shown on that form. 3 Subtract line 3 from line 2. Enter the result here and on Form 1040A, or 4 Form 1040, line 8a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... 4 Note: If line 4 is over $1,500, you must complete Part III. Amount List name of payer _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Part II ___ Ordinary Dividends (See instructions on back and the instructions for Form 5 1040A, or Form 1040, line 9a.) Note: If you received a Form 1099-DIV or substitute statement from a brokerage firm, list the firm's name as the payer and enter the ordinary dividends shown on that form. 5 Add the amounts on line 5. Enter the total here and on Form 1040A, or 6 Form 1040, line 9a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... 6 Note: If line 6 is over $1,500, you must complete Part III. You must complete this part if you (a) had over $1,500 of taxable interest or ordinary dividends; (b) had a foreign account; or (c) received a distribution from, or were a grantor of, or a transferor to, a foreign trust. Yes No Part III At any time during 2015, did you have a financial interest in or signature authority over a financial account (such as a Foreign 7a bank account, securities account, or brokerage account) located in a foreign country? See instructions . . . . . . . . . . . . . . http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 8 of 9 2017/01/22 3:02 Accounts ................................ and If \"Yes,\" are you required to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), to report that Trusts financial interest or signature authority? See FinCEN Form 114 and its instructions for filing requirements and exceptions (See to those requirements . . . . . . . . . . . instructions on back.) b 8 If you are required to file FinCEN Form 114, enter the name of the foreign country where the financial account is located _________________________________ During 2015, did you receive a distribution from, or were you the grantor of, or transferor to, a foreign trust? If "Yes," you may have to file Form 3520. See instructions on back . . . . . . . . . For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 17146N Schedule B (Form 1040A or 1040) 2015 2. 3. 2\tmore\tCheck\tMy\tWork\tuses\tremaining. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 9 of 9 2017/01/22 3:13 1. 2. Comprehensive Problem 1 - Part 2 Note: If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers. If an amount box does not require an entry or the answer is zero, enter "0". OMB No. 1545- SCHEDULE C Profit or Loss From Business (Form 1040) (Sole Proprietorship) 2015 0074 Information about Schedule C and its separate instructions is at Department of the Treasury Internal Revenue Service (99) Attachment www.irs.gov/schedulec. Attach to Form 1040, 1040NR, or 1041; partnerships generally must 09 file Form 1065. Name of proprietor Sequence No. Social security number (SSN) Noah Arc 434-11-3311 A Principal business or profession, including product or service (see instructions) B Enter code from instructions Pet Store 453910 C Business name. If no separate business name, leave blank. D Employer ID number (EIN), (see instr.) The Arc 959876556 18542 Mission Road E Business address (including suite or room no.) City, town or post office, state, and ZIP code Santee, CA 92071 F Accounting method: (1) Cash (2) Accrual (3) Other (specify) _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ G Did you "materially participate" in the operation of this business during 2015? If "No," see instructions for limit on losses H If you started or acquired this business during 2015, check here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No I Did you make any payments in 2015 that would require you to file Form(s) 1099? (see instructions) . . . . . . . . . . Yes No J If "Yes," did you or will you file required Forms 1099? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No Part I Income 1 Gross receipts or sales. See instructions for line 1 and check the box if this income was reported to you on Form W-2 and the "Statutory employee" box on that form was checked . . . . . . . . . . . . . . . 1 2 Returns and allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 3 Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4 Cost of goods sold (from line 42) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 5 Gross profit. Subtract line 4 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 6 Other income, including federal and state gasoline or fuel tax credit or refund (see instructions) . . . . . . . 7 Gross income. Add lines 5 and 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 7 Part II Expenses. Enter expenses for business use of your home only on line 30. 8 Advertising . . . . . . . . . . . . . . . . 8 9 Car and truck expenses (see instructions) . . . . . . . . . . . . . . . 9 10 Commissions and fees . . . . . . . 10 11 Contract labor (see instructions) 11 12 Depletion . . . . . . . . . . . . . . . . . 12 13 Depreciation and section 179 expense deduction (not included in Part III) (see instructions) . . . 13 18 Office expense (see instructions) . . . . 18 19 Pension and profit-sharing plans . . . . 19 20 Rent or lease (see instructions): . . . . . a Vehicles, machinery, and equipment 20a b Other business property . . . . . . . . . . . 20b 21 Repairs and maintenance . . . . . . . . . 21 22 Supplies (not included in Part III) . . . 22 23 Taxes and licenses . . . . . . . . . . . . . . . 23 24 Travel, meals, and entertainment: . . . 14 Employee benefit programs a Travel . . . . . . . . . . . . . . . . . . . . . . . . (other than on line 19) . . . . . . . 14 15 Insurance (other than health) . . 15 16 Interest: . . . . . . . . . . . . . . . . . a Mortgage (paid to banks, etc.) . . 16a b Other . . . . . . . . . . . . . . . . . . . 16b 24a b Deductible meals and entertainment (see instructions) . . . . 24b 25 Utilities . . . . . . . . . . . . . . . . . . . . . . 25 26 Wages (less employment credits) . . . . 26 27a Other expenses (from line 48) . . . . . http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 27a Page 1 of 8 2017/01/22 3:13 17 Legal and professional services 17 b Reserved for future use . . . . . . . . . . 27b 28 Total expenses before expenses for business use of home. Add lines 8 through 27a . . . . . . . . . . . . . . 28 29 Tentative profit or (loss). Subtract line 28 from line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Expenses for business use of your home. Do not report these expenses elsewhere. Attach Form 8829 unless using the simplified method (see instructions). 30 Simplified method filers only: enter the total square footage of: (a) your home: for business: and (b) the part of your home used . Use the Simplified Method Worksheet in the instructions to figure the amount to enter on line 30 . . . . . . 30 ............................................ 31 Net profit or (loss). Subtract line 30 from line 29. If a profit, enter on both Form 1040, line 12 (or Form 1040NR, line 13) and on Schedule SE, line 2. (If you checked } the box on line 1, see instructions). Estates and trusts, enter on Form 1041, line 3. If a loss, you must go to line 32. 31 32 If you have a loss, check the box that describes your investment in this activity (see instructions). 32a All investment If you checked 32a, enter the loss on both Form 1040, line 12, (or Form 1040NR, line 13) and on Schedule SE, line 2. (If you checked the box on line 1, see the line 31 instructions). Estates and trusts, enter on Form 1041, line 3. } 32b is at risk. Some If you checked 32b, you must attach Form 6198. Your loss may be limited. investment is not at risk. For Paperwork Reduction Act Notice, see the separate instructions. Cat. No. 11334P Schedule C (Form 1040) 2015 Schedule C (Form 1040) 2015 Noah Arc 434-11-3311 Page 2 Part III Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: a Cost b Lower of cost or market c Other (attach explanation) 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? If "Yes," attach explanation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation . . . . . . . 35 36 Purchases less cost of items withdrawn for personal use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 No 37 Cost of labor. Do not include any amounts paid to yourself . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 38 Materials and supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 39 Other costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 40 Add lines 35 through 39 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 41 Inventory at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on line 4 . . . . . . . . . . . . . . . . Part IV 43 42 Information on Your Vehicle. Complete this part only if you are claiming car or truck expenses on line 9 and are not required to file Form 4562 for this business. See the instructions for line 13 to find out if you must file Form 4562. When did you place your vehicle in service for business purposes? (month, day, year) / / 44 Of the total number of miles you drove your vehicle during 2015, enter the number of miles you used your vehicle for: a Business b Commuting (see instructions) c Other 45 Was your vehicle available for personal use during off-duty hours? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 46 Do you (or your spouse) have another vehicle available for personal use? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No 47a Do you have evidence to support your deduction? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No b If "Yes," is the evidence written? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No Part V Other Expenses. List below business expenses not included on lines 8-26 or line 30. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 2 of 8 2017/01/22 3:13 48 Total other expenses. Enter here and on line 27a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Schedule C (Form 1040) 2015 OMB No. 1545- SCHEDULE D Capital Gains and Losses (Form 1040) Attach to Form 1040 or Form 1040NR. 2015 0074 Information about Schedule D and its separate instructions is at Department of the Treasury Internal Revenue Service (99) Attachment www.irs.gov/scheduled. Sequence No. Use Form 8949 to list your transactions for lines 1b, 2, 3, 8b, 9, and 12 10. Name(s) shown on return Your social security number Noah and Joan Arc 434-11-3311 Part I Short-Term Capital Gains and LossesAssets Held One Year or Less See instructions for how to figure the amounts to enter on the lines below. (g) (h) Gain or Adjustments to gain or This form may be easier to complete if you round off cents to whole dollars. (d) (e) loss from Proceeds Cost (or Form(s) (sales price) other basis) 8949, Part I, (loss) Subtract column (e) from column (d) and combine the result with line 2, column (g) column (g) 1a Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 1b . . . . . . . . . . . . . . . . . . . . . . . . 1b Totals for all transactions reported on Form(s) 8949 with Box A checked . . . . . . . . . .............................. 2 Totals for all transactions reported on Form(s) 8949 with Box B checked . . . . . . . . . .............................. 3 Totals for all transactions reported on Form(s) 8949 with Box C checked . . . . . . . . . .............................. 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 . . . . . . . . . . 4 5 Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 5 6 Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 . ( ) 7 Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back . . . . . . . . . . . . . . . . . . . . . . 7 Part II Long-Term Capital Gains and LossesAssets Held More Than One Year See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars. (h) Gain or (d) (e) Proceeds Cost (or (sales price) other basis) (g) (loss) Adjustments Subtract to gain or loss column (e) from Form(s) from column 8949, Part II, (d) and line 2, column combine the (g) result with column (g) 8a Totals for all long-term transactions reported on Form 1099-B for which basis was http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 3 of 8 2017/01/22 3:13 reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 8b . . . . . . . . . . . . . . . . . . . . . . . . 8b Totals for all transactions reported on Form(s) 8949 with Box D checked . . . . . . . . . . ............................. 9 Totals for all transactions reported on Form(s) 8949 with Box E checked . . . . . . . . . . ............................. 10 Totals for all transactions reported on Form(s) 8949 with Box F checked . . . . . . . . . . ............................. 11 Gain from Form 4797, Part I; long-term gain from Forms 2439 and 6252; and long-term gain or (loss) from 11 Forms 4684, 6781, and 8824 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 . . . . 12 13 Capital gain distributions. See the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 14 Long-term capital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover 14 Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Net long-term capital gain or (loss). Combine lines 8a through 14 in column (h). Then go to Part III on the back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 11338H Schedule D (Form 1040) 2015 Schedule D (Form 1040) 2015 Noah and Joan Arc 434-11-3311 Page 2 Part III Summary 16 Combine lines 7 and 15 and enter the result . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... 16 a. If line 16 is a gain, enter the amount from line 16 on Form 1040, line 13, or Form 1040NR, line 14. Then go to line 17 below. b. If line 16 is a loss, skip lines 17 through 20 below. Then go to line 21. Also be sure to complete line 22. c. If line 16 is zero, skip lines 17 through 21 below and enter -0- on Form 1040, line 13, or Form 1040NR, line 14. Then go to line 22. 17 Are lines 15 and 16 both gains? Yes. Go to line 18. No. Skip lines 18 through 21, and go to line 22. 18 19 Enter the amount, if any, from line 7 of the 28% Rate Gain Worksheet in the instructions . . ....... 18 19 Enter the amount, if any, from line 18 of the Unrecaptured Section 1250 Gain Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........... 20 Are lines 18 and 19 both zero or blank? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44 (or in the instructions for Form 1040NR, line 42). Do not complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions. Do not complete lines 21 and 22 below. 21 If line 16 is a loss, enter here and on Form 1040, line 13, or Form 1040NR, line 14, the smaller of: a. The loss on line 16 or b. ($3,000), or if married filing separately, ($1,500) } ......................... 21 ( ) Note. When figuring which amount is smaller, treat both amounts as positive numbers. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 4 of 8 2017/01/22 3:13 22 Do you have qualified dividends on Form 1040, line 9b, or Form 1040NR, line 10b? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44 (or in the instructions for Form 1040NR, line 42). No. Complete the rest of Form 1040 or Form 1040NR. Schedule D (Form 1040) 2015 Form OMB No. 1545- Sales and Other Dispositions of Capital Assets 8949 0074 Information about Form 8949 and its separate instructions is at 2015 www.irs.gov/form8949. Department of the Treasury Internal Attachment File with your Schedule D to list your transactions for lines 1b, 2, 3, 8b, 9, Revenue Service Sequence No. and 10 of Schedule D. Name(s) shown on return 12A Social security number or taxpayer identification number Noah and Joan Arc 434-11-3311 Before you check Box A, B, or C below, see whether you received any Form(s) 1099-B or substitute statement(s) from your broker. A substitute statement will have the same information as Form 1099-B. Either will show whether your basis (usually your cost) was reported to the IRS by your broker and may even tell you which box to check. Part I Short-Term. Transactions involving capital assets you held 1 year or less are short term. For long-term transactions, see page 2. Note: You may aggregate all short-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 1a; you aren't required to report these transactions on Form 8949 (see instructions). You must check Box A, B, or C below. Check only one box. If more than one box applies for your short-term transactions, complete a separate Form 8949, page 1, for each applicable box. If you have more short-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need. (A) (B) (C) Short-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above) Short-term transactions reported on Form(s) 1099-B showing basis was not reported to the IRS Short-term transactions not reported to you on Form 1099-B 1 Adjustment, if any, to gain (e) (a) Description of property (Example: 100 sh. XYZ Co.) (b) Date acquired (Mo., day, yr.) (c) Date sold or disposed of (Mo., day, yr.) (d) Cost or other Proceeds basis. See the (sales price) Note below and (see see Column (e) in instructions) the separate instructions or loss. If you enter an (h) amount in column (g), enter Gain or (loss). a code in column (f). See the Subtract column (e) separate instructions. (f) (g) Code(s) from Amount of instructions adjustment from column (d) and combine the result with column http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 (g) Page 5 of 8 2017/01/22 3:13 2 Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts). Enter each total here and include on your Schedule D, line 1b (if Box A above is checked), line 2 (if Box B above is checked), or line 3 (if Box C above is checked) . Note: If you checked Box A above but the basis reported to the IRS was incorrect, enter in column (e) the basis as reported to the IRS, and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to figure the amount of the adjustment. For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 37768Z Form 8949 (2015) Form 8949 (2015) Attachment Sequence No. 12A Page 2 Name(s) shown on return. Name and SSN or taxpayer identification no. not required if Social security number or taxpayer identification number shown on other side Noah and Joan Arc 434-11-3311 Before you check Box D, E, or F below, see whether you received any Form(s) 1099-B or substitute statement(s) from your broker. A substitute statement will have the same information as Form 1099-B. Either will show whether your basis (usually your cost) was reported to the IRS by your broker and may even tell you which box to check. Part II Long-Term. Transactions involving capital assets you held more than 1 year are long term. For short-term transactions, see page 1. Note: You may aggregate all long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 8a; you aren't required to report these transactions on Form 8949 (see instructions). You must check Box D, E, or F below. Check only one box. If more than one box applies for your long-term transactions, complete a separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need. (D) (E) (F) Long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above) Long-term transactions reported on Form(s) 1099-B showing basis was not reported to the IRS Long-term transactions not reported to you on Form 1099-B 1 Adjustment, if any, to gain (e) (a) Description of property (Example: 100 sh. XYZ Co.) (b) Date acquired (Mo., day, yr.) (c) Date sold or disposed (Mo., day, yr.) (d) Cost or other Proceeds basis. See the (sales price) Note below and (see see Column (e) in instructions) the separate instructions or loss. If you enter an (h) amount in column (g), enter Gain or (loss). a code in column (f). See the Subtract column (e) separate instructions. (f) (g) Code(s) from Amount of instructions adjustment from column (d) and combine the result with column http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 (g) Page 6 of 8 2017/01/22 3:13 2 Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts). Enter each total here and include on your Schedule D, line 8b (if Box D above is checked), line 9 (if Box E above is checked), or line 10 (if Box F above is checked) Note: If you checked Box D above but the basis reported to the IRS was incorrect, enter in column (e) the basis as reported to the IRS, and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to figure the amount of the adjustment. Form 8949 (2015) Qualified Dividends and Capital Gain Tax WorksheetLine 44 Keep for Your Records Before you See the earlier instructions for line 44 to see if you can use this worksheet to figure your tax. begin: Before completing this worksheet, complete Form 1040 through line 43. If you do not have to file Schedule D and you received capital gain distributions, be sure you checked the box on line 13 of Form 1040. 1. Enter the amount from Form 1040, line 43. However, if you are filing Form 2555 or 2555-EZ (relating to foreign earned income), enter the amount from line 3 of the Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . ................................... 1. 2. Enter the amount from Form 1040, line 9b* . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Are you filing Schedule D?* Enter the smaller of line 15 or 16 of Schedule D. If either line 15 or line 16 is blank or a loss, Yes. enter -0- No. Enter the amount from Form 1040, line 13 } 3. 4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. If filing Form 4952 (used to figure investment interest expense deduction), enter any amount from line 4g of that form. Otherwise, enter -0- . . . . . . . . 5. 6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. 7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Enter: $37,450 if single or married filing separately, $74,900 if married filing jointly or qualifying widow(er), } ....... .... 8. $50,200 if head of household. 9. Enter the smaller of line 1 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Enter the smaller of line 7 or line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. 11. Subtract line 10 from line 9. This amount is taxed at 0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. 12. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12. 13. Enter the amount from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13. 14. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. 15. Enter: $413,200 if single, http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 7 of 8 2017/01/22 3:13 $232,425 if married filing separately, } ....... .... 15. $464,850 if married filing jointly or qualifying widow(er), $439,050 if head of household. 16. Enter the smaller of line 1 or line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. 17. Add lines 7 and 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. 18. Subtract line 17 from line 16. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18. 19. Enter the smaller of line 14 or line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19. 20. Multiply line 19 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20. 21. Add lines 11 and 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. 22. Subtract line 21 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22. 23. Multiply line 22 by 20% (.20) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23. 24. Figure the tax on the amount on line 7. If the amount on line 7 is less than $100,000, use the Tax Table to figure the tax. If the amount on line 7 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . 25. Add lines 20, 23, and 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24. 25. 26. Figure the tax on the amount on line 1. If the amount on line 1 is less than $100,000, use the Tax Table to figure the tax. If the amount on line 1 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . 26. 27. Tax on all taxable income. Enter the smaller of line 25 or line 26. Also include this amount on Form 1040, line 44. If you are filing Form 2555 or 2555-EZ, do not enter this amount on Form 1040, line 44. Instead, enter it on line 4 of the Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27. * If you are filing Form 2555 or 2555-EZ, see the footnote in the Foreign Earned lncorne Tax Worksheet before completing this line. 3. 2\tmore\tCheck\tMy\tWork\tuses\tremaining. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 8 of 8 2017/01/22 3:13 1. 2. 3. Comprehensive Problem 1 - Part 3 If required, round your answers to the nearest dollar. If an amount box does not require an entry or the answer is zero, enter "0". Note: On Schedule SE, use the rounded amounts in subsequent computations. SCHEDULE E (Form 1040) Supplemental Income and Loss OMB No. 1545- (From rental real estate, royalties, partnerships, S corporations, estates, 2015 trusts, REMICs, etc.) Department of the Treasury Internal Revenue Service (99) 0074 Attachment Attach to Form 1040, 1040NR, or Form 1041. Sequence No. Information about Schedule E and its separate instructions is at 13 www.irs.gov/schedulee. Name(s) shown on return Your social security number Noah and Joan Arc Part I 434-11-3311 Income or Loss From Rental Real Estate and Royalties Note: If you are in the business of renting personal property, use Schedule C or C-EZ (see instructions). If you are an individual, report farm rental income or loss from Form 4835 on page 2, line 40. A Did you make any payments in 2015 that would require you to file Form(s) 1099? (see instructions) Yes No Yes No B If "Yes," did you or will you file required Forms 1099? 1a Physical address of each property (street, city, state, ZIP code) A 6431 Gary Court, San Diego, CA 92115 B C Type of 1b Property (from list below) For each rental real estate property listed above, report the number of fair rental and personal 2 use days. Check the QJV box only if you meet the requirements to file as a qualified joint A venture. See instructions. B C Fair Personal Rental Use Days Days QJV A B C Type of Property: 1 Single Family Residence 3 Vacation/Short-Term Rental 5 Land 2 Multi-Family Residence 4 Commercial 7 Self-Rental 6 Royalties 8 Other (describe) Income: Properties: A 3 Rents received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4 Royalties received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 B C Expenses: 5 Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 6 Auto and travel (see instructions) . . . . . . . . . . . . . . . . . . . . . 6 7 Cleaning and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . 7 8 Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 10 Legal and other professional fees . . . . . . . . . . . . . . . . . . . . . 10 11 Management fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12 Mortgage interest paid to banks, etc. (see instructions) . . . . 12 13 Other interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 14 Repairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 16 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 Depreciation expense or depletion . . . . . . . . . . . . . . . . . . . . 18 http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 1 of 8 2017/01/22 3:13 Other (list) Miscellaneous 19 19 20 20 Total expenses. Add lines 5 through 19 . . . . . . . . . . . . . . . . 21 Subtract line 20 from line 3 (rents) and/or 4 (royalties). If result is a (loss), see instructions to find 21 out if you must file Form 6198 22 Deductible rental real estate loss after limitation, if any, on Form 8582 (see instructions) . . . . . . . . 22 ( ................ ) ( 23a Total of all amounts reported on line 3 for all rental properties . . . . . . . . . . . . . . . 23a b Total of all amounts reported on line 4 for all royalty properties . . . . . . . . . . . . . . 23b c Total of all amounts reported on line 12 for all properties . . . . . . . . . . . . . . . . . . . 23c d Total of all amounts reported on line 18 for all properties . . . . . . . . . . . . . . . . . . . 23d e Total of all amounts reported on line 20 for all properties . . . . . . . . . . . . . . . . . . . 23e ) ( 24 Income. Add positive amounts shown on line 21. Do not include any losses . . . . . . . . . . . . . . . . . . . 24 25 Losses. Add royalty losses from line 21 and rental real estate losses from line 22. Enter total losses here 25 ( 26 Total rental real estate and royalty income or (loss). Combine lines 24 and 25. Enter the result here. If Parts II, III, IV, ) ) and line 40 on page 2 do not apply to you, also enter this amount on Form 1040, line 17, or Form 1040NR, line 18. Otherwise, include this amount in the total on line 41 on page 2 . . . . . . . 26 For Paperwork Reduction Act Notice, see the separate instructions. Cat. No. 11344L Schedule E (Form 1040) 2015 Schedule E (Form 1040) 2015 Attachment Sequence No. 13 Page 2 Name(s) shown on return. Do not enter name and social security number if shown on other side. Your social security number Noah and Joan Arc 434-11-3311 Caution. The IRS compares amounts reported on your tax return with amounts shown on Schedule(s) K-1. Part II Income or Loss From Partnerships and S Corporations Note: If you report a loss from an at-risk activity for which any amount is not at risk, you must check the box in column (e) on line 28 and attach Form 6198. See instructions. 27 Are you reporting any loss not allowed in a prior year due to the at-risk, excess farm loss, or basis limitations, a prior year unallowed loss from a passive activity (if that loss was not reported on Form 8582), or unreimbursed partnership expenses? If you answered "Yes," see instructions Yes before completing this section. 28 No (a) (b) Enter P for partnership; S for S (c) Check if foreign (d) Employer identification (e) Check if any amount is not Name corporation partnership number at risk A B C D Passive Income and Loss Nonpassive Income and Loss (f) Passive loss allowed (attach (g) Passive income from (h) Nonpassive loss from Form 8582 if required) Schedule K-1 Schedule K-1 (i) Section 179 expense (j) Nonpassive deduction from Form income from 4562 Schedule K-1 A B C D 29a Totals b Totals 30 31 Add columns (g) and (j) of line 29a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... Add columns (f), (h), and (i) of line 29b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 30 31 ( ) 32 Total partnership and S corporation income or (loss). Combine lines 30 and 31. Enter the result here and include in the total on line 41 below . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 32 http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 2 of 8 2017/01/22 3:13 Part III Income or Loss From Estates and Trusts 33 (a) Name (b) Employer identification number A B Passive Income and Loss Nonpassive Income and Loss (f) Other (c) Passive deduction or loss allowed (attach Form 8582 if required) (d) Passive income (e) Deduction or loss income from from Schedule K-1 from Schedule K-1 Schedule K-1 A B 34a Totals b Totals 35 Add columns (d) and (f) of line 34a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 36 Add columns (c) and (e) of line 34b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 ( ) 37 Total estate and trust income or (loss). Combine lines 35 and 36. Enter the result here and include in the total on line 41 below . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Part IV Income or Loss From Real Estate Mortgage Investment Conduits (REMICs)Residual Holder (e) Income 38 (a) (b) Employer (c) Excess inclusion from Schedules Q, line 2c (d) Taxable income (net loss) from from Name identification number (see instructions) Schedules Q, line 1b Schedules Q, line 3b 39 Combine columns (d) and (e) only. Enter the result here and include in the total on line 41 below Part V 39 Summary 40 40 Net farm rental income or (loss) from Form 4835. Also, complete line 42 below . . . . . . . . . . . . . . . . . 41 Total income or (loss). Combine lines 26, 32, 37, 39, and 40. Enter the result here and on Form 1040, line 17, or Form 1040NR, line 18 41 42 Reconciliation of farming and fishing income. Enter your gross farming and fishing income reported on Form 4835, line 7; Schedule K-1 (Form 1065), box 14, code B; Schedule K-1 (Form 1120S), box 17, code V; and Schedule K-1 (Form 1041), box 14, code F (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 43 Reconciliation for real estate professionals. If you were a real estate professional (see instructions), enter the net income or (loss) you reported anywhere on Form 1040 or Form 1040NR from all rental real estate activities in which you materially participated under the passive activity loss rules . . . . . . . . . . . . . . . . . . . . . . . 43 Schedule E (Form 1040) 2015 OMB No. 1545SCHEDULE SE Self-Employment Tax (Form 1040) Department of the Treasury Internal Revenue Service (99) Information about Schedule SE and its separate instructions is at www.irs.gov/schedulese. Attach to Form 1040 or Form 1040NR. 0074 2015 Attachment Sequence No. 17 Name of person with self-employment income (as shown on Form 1040 or Social security number of person with selfForm 1040NR) employment income Noah Arc 434-113311 Before you begin: To determine if you must file Schedule SE, see the instructions. May I Use Short Schedule SE or Must I Use Long Schedule SE? Note. Use this flowchart only if you must file Schedule SE. If unsure, see Who Must File Schedule SE in the instructions. http://cxp.cengage.com/activityservice/run/html5/handler.jsp?id=2...gagenow.com&xdm_c=activityService_activity_1485070722769&xdm_p=1 Page 3 of 8 2017/01/22 3:13 Did you receive wages or tips in 2015? No Yes Are you a minister, member of a religious order, or Christian Science Was the total of your wages and tips subject to social Yes practitioner who received IRS approval not to be taxed on earnings from Are you using one of the optional methods to figure your net earnings (see net earnings from self-employment more than these sources, but you owe self-employment tax on other earnings? No Yes security or railroad retirement (tier 1) tax plus your $118,500? No Did you receive tips subject to social