Note: This problem is for the 2020 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2018. Alfred and Beulah will file a joint return for 2020. Alfred's Social Security number is 111-11-1109. Beulah's Social Security number is 123-45-6780, and she has chosen to use "old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2017. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10 years or until Sarah's death, whichever occurs first. Alfred paid Sarah $15,000 in 2020. In addition, in January 2020, Alfred paid Sarah $50,000, which is designated as being for her share of the marital property. Also, Alfred is responsible for all prior years' income taxes. Sarah's Social Security number is 123-45-6788. Alfred's salary for 2020 is $150,000. He is an executive working for Cherry, Inc. (Federal I.D. No. 98-7654321). As part of his compensation package, Cherry provides him with group term life insurance equal to twice his annual salary. His employer withheld $24,900 for Federal income taxes and $8,000 for state income taxes. The proper amounts were withheld for FICA taxes. Beulah recently graduated from law school and is employed by Legal Aid Society, Inc. (Federal I.D. No. 11-1111111), as a public defender. She received a salary of $42,000 in 2020. Her employer withheld $7,500 for Federal income taxes and $2,400 for state income taxes. The proper amounts were withheld for FICA taxes. Alfred and Beulah received taxable interest income of $500. Alfred and Beulah received a $1,900 refund on their 2019 state income taxes; they claimed the standard deduction on their 2019 Federal income tax return. Alfred and Beulah paid $4,500 interest and $1,450 property taxes on their personal residence in 2020. They paid sales taxes of $1,400, for which they maintain the receipts. Alfred and Beulah have never owned or used any virtual currency, and they do not want to contribute to the Presidential Election Campaign. Alfred and Beulah received the appropriate coronavirus recovery rebates (economic impact payments); related questions in ProConnect Tax should be ignored. Required: Compute the Olds' net tax payable (or refund due) for 2020. Use Form 1040 and Schedule 1 to complete this tax return. It may be necessary to complete the tax schedule and worksheet before completing Form 1040. Enter all amounts as positive numbers. . If an amount box does not require an entry or the answer is zero, enter "0". Make realistic assumptions about any missing data. When computing the tax liability, do not round your immediate calculations. If required round your final answers to the nearest dollar. Use the 2020 Tax Rate Schedule provided. Do not use the Tax Tables. Complete Form 1040 for the Olds. Form Department of the Treasury-Internal Revenue Service (99) 1040 U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 IRS Use Only Filing Status Your first name and middle initial Last name Your social security number Alfred E. Old 111-11-1109 If joint return, spouse's first name and middle initial Last name Spouse's social security number Beulah A. Old 123-45-6780 Home address (number and street). If you have a P.O. box, see instructions. Apt. no. Presidential Election Campaign 211 Blackstone Drive Check here if you, or your spouse ir filling jointly, want $3 to go to this City, town, or post office. If you have a foreign address, also complete State ZIP code fund. Checking a box below will not spaces below. Atlanta, GA 30304 change your tax or refund. Foreign country name Foreign province/State/county Foreign postal code At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Standard Deduction Someone can claim: Age/Blindness You: Spouse: (see instructions): (3) Relationship (2) Social security number to you (4) Vif qualifies for (see instructions): Child tax credit Credit for other dependents (1) First name Last name Dependents If more than four dependents, see instructions and check here O 1 Wages, salaries, tips, etc. Attach Form(s) W-2 1 2a 2a Tax-exempt interest .. b Taxable interest Attach Sch. Bir required. 2b 3a Qualified dividends... 3a b Ordinary dividends 3b 4b 5b 4a IRA distributions. b Taxable amount. 5a Pensions and annuities 5a b Taxable amount. 6a Social security benefits b Taxable amount. 7 Capital gain or loss). Attach Schedule D if required. If not required, check here... 6b Standard Deduction for- Sinnl 7 6b 6a Social Security benefits b Taxable amount. 7 Capital gain or loss). Attach Schedule D if required. If not required, check here 7 B Other income from Schedule 1, line 9 8 9 Add lines 1, 2, 3, 4, 5b, 6b, 7, and 8. This is your total income. 9 10 Adjustments to income: Standard Deduction for- Single or Married filing separately $12,400 Married filing jointly or Qualifying widower), $24.800 Head of household $18,650 If you checked any box under Standard Deduction, see instructions a From Schedule 1, line 22 10a b Charitable contributions if you take the standard deduction. See instructions 10b c Add lines 10a and 10b. These are your total adjustments to income 10c 11 Subtract line 10c from line 9. This is your adjusted gross income 11 12 Standard deduction or itemized deductions (from Schedule A) 12 13 Qualified business income deduction. Attach Form 8995 or Form 8995-A. 13 14 Add lines 12 and 13 14 Taxable income. Subtract line 14 from line 11. If zero or less, enter-O- 15 15 BAA For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Form 1040 (2020) Form 1040 (2020) Alfred E. and Beulah A. Old 111-11-1109 Page 2 16 Tax (see instructions). Check if any from Form(s): 1 8814 24972 30 16 17 Amount from Schedule 2, line 3 17 18 Add lines 16 and 17 18 19 Child tax credit or credit for other dependents door 19 20 Amount from Schedule 3, line 7. 20 21 Add lines 19 and 20 21 22 22 23 Subtract line 21 from line 18. If zero or less, enter-O- Other taxes, including self-employment tax, from Schedule 2 line 10. Add lines 22 and 23. This is your total tax 23 24 24 25 Federal income tax withheld from: Form(s) W-2 a 25a b Formis) 1099 25b 25 Federal income tax withheld from: Form(s) W-2 a 25a 25b b Form(s) 1099 Other forms (see instructions). 25c d Add lines 25a through 25c.. 250 26 If you have a 26 qualifying child attach Sch. EIC. 27 If you have nontaxable combat pay, see 28 instructions 2020 estimated tax payments and amount applied from 2019 return Eamed income credit (EIC) 27 Additional child tax credit. Attach Schedule 8812 28 American opportunity credit from Form 8863, line 8 29 29 Recovery rebate credit. See instructions 30 30 Amount from Schedule 3, line 13 31 31 32 Add lines 27 through 31. These are your total other payments and refundable credits 32 33 Add lines 25d, 26, and 32. These are your total payments 33 Refund 34 Ir line 33 is more than line 24, subtract line 24 from line 33. This is the amount you overpaid 34 35a Amount of line 34 you want refunded to you. If Form 8888 is attached, check here 35a Complete Olds' Schedule 1 for 2020. SCHEDULE 1 OMB No. 1545-0074 Additional Income and Adjustments to Income (Form 1040) 2020 Department of the Treasury Attach to Form 1040, 1040-SR, or 1040-NR. Attachment Internal Revenue Service Go to www.irs.gov/Form1040 for instructions and the latest information. Sequence No. 01 Name(s) shown on Form 1040, 1040-SR, or 1040-NR Your social security number Alfred E. and Beulah A. Old 111-11-1109 Part I Additional Income 1 Taxable refunds, credits, or offsets of state and local income taxes 1 2a Alimony received 2a b Date of original divorce or separation agreement (see instructions) 3 Business income or (loss). Attach Schedule C.. 3 Other gains or losses). Attach Form 4797. 5 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E. S 5 6 Farm income or loss). Attach Schedule F. 6 van 7 Unemployment compensation ... 7 B Other income. List type and amount 8 9 Combine lines 1 through 8. Enter here and on Form 1040, 1040-SR, or 1040-NR, line 8 9 Part II Adjustments to Income 10 Educator expenses. 10 11 11 Certain business expenses of reservists, performing artists, and fee-basis government officials. Attach Form 2106 12 Health savings account deduction. Attach Form 8889. 12 13 Moving expenses for members of the Armed Forces. Attach Form 3903 13 14 Deductible part of self-employment tax. Attach Schedule SE 14 15 Self-employed SEP, SIMPLE, and qualified plans. 15 16 Self-employed health insurance deduction. 16 17 Penalty on early withdrawal of savings. 17 16 Self-employed health insurance deduction 16 17 Penalty on early withdrawal of savings. 17 18a Alimony paid 18a b Recipient's SSN 123-45-6788 c Date of original divorce or separation agreement (see instructions) 03/2017 19 IRA deduction 19 20 Student loan interest deduction. 20 21 Tuition and fees deduction. Attach Form 8917. 21 22 Add lines 10 through 21. These are your adjustments to income. Enter here and on Form 1040, 1040-SR, or 1040-NR, line 10a.... 22 BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule 1 (Form 1040) 2020 EXHIBIT 5.1 Uniform Premiums for $1,000 of Group Term Life Insurance Protection Attained Age on Last Day of Employee's Tax Year Under 25 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70 and above Cost per $1,000 of Protection for One-Month Period $0.05 0.06 0.08 0.09 0.10 0.15 0.23 0.43 0.66 1.27 2.06 *Reg. $ 1.79-3, effective for coverage after June 30, 1999. Use the 2020 Tax Rate Schedules to compute the tax. (Note: Because the tax rate schedules are used instead of the tax tables, the amount of tax computed may vary slightly from the amount listed in the tables.) 2020 Tax Rate Schedules Single-Schedule X Head of household-Schedule z of the If taxable income is: Over- of the amount If taxable income is: Over- But not over- amount But not over- The tax is: over- The tax is: over- SO $ 9,875 ...... 10% $0 $0 $ 14,100 ...... 10% $0 9,875 40,125 $ 987.50 + 12% 9,875 14,100 14,100 $ 1,410.00 + 12% 6,162.00 + 22% 40,125 85,525 4,617.50 + 22% 40,125 53,700 85,500 163,300 53,700 53,700 85,500 85,525 163,300 14,605.50 + 24% 85,525 13,158.00 + 24% 85,525 163,300 207,350 33,271.50 + 32% 163,300 31,830.00 + 32% 163,300 207,350 207,350 518,400 518,400 207,350 207,350 47,367.50 + 35% 156,235.00 + 37% 45,926.00 + 35% 154,793.50 + 37% 163,300 207,350 518,400 518,400 518,400 518,400 Married filing jointly or Qualifying widow(er)-Schedule Y-1 Married filing separately-Schedule Y-2 of the If taxable income is: Over- of the amount over- If taxable income is: Over- But not over- But not amount The tax is: Over- The tax is: over SO $19,750 ...... 10% $0 $0 $ 9,875 ...... 10% $0 80,250 9,875 9,875 19,750 80,250 171,050 19,750 80,250 $ 987.50 + 12% 4,617.50 + 22% 40,125 40,125 171,050 326,600 414,700 $ 1,975.00 + 12% 9,235.00 + 22% 29,211.00 + 24% 66,543.00 + 32% 94,735.00 + 35% 85,525 40,125 85,525 163,300 207,350 311,025 14,605.50 + 24% 171,050 326,600 85,525 163,300 163,300 326,600 414,700 33,271.50 + 32% 47,367.50 + 35% 622,050 414,700 207,350 207,350 311,025 622,050 167,307.50 + 37% 622,050 311,025 83,653.75 + 37%