NOTE: Use 2022 tax rates to complete Lapin's 2022 Tax Return. Following is a list of information for Michael and Diana Lapin for the tax year 2022. Michael and Diana are married and have three children, Amara, Bryan, anl Skyla. They live at 120 Main Stret, Flushing NY 11425 . Michael is a Business Law Professor teaching at BMCC - CUNY, Diana works part-time for information is as follows: Dependents: Assume that all other requirements are met by each potental dependent. Michael's Previous Marriage: Michael is obligated to pay Alimony of $600 and child support of $1,000 monthly to Evelyn based upon their divorce decree dated 1/20/2020. All payments were made on time and no previous arrears existed. However, as of December 31,2022 , he had only paid a total of $13,000. Michael and Evelyn both agreed that the outstanding balance will be paid in January 2023 . The Lapin' W-2 information is as follows: Besides teaching at BMCC, Michael also has his own private consulting practice (Lapin Legal Consultancy, LLC, EIN: 55-5687541, Business code: 541110, Accounting method: Cash Basis), located at 195 Chambers street, New York, NY 10007. The income and expenses associated with his practice are as follows: Note 1 - the category office equipment includes printers, computers, fax machines, percolators, phones, microwave, and office refrigerator. The items were placed in service during 2022 . Michael is unfamiliar with the tax treatment and therefore requires your help. He is greatly concem with the tax benefits available for the costs incurred for office equipment. Hint: should he capitalized and depreciate the equipment cost, or is there another available tax treatment? Note 2 -Michael visited his mother who lives in Miami, where he spent a total of three days. He used his business card to secure a cheaper flight. The $3,000 cost includes flight and car rental services. Note 3 - Lapin Legal Consultancy, LLC, was sued by the US govemment, regarding a criminal violation of antitrust laws. He entered a no-contest plea and paid the fine of 90,000 to settle the case. Hint: Read chapter 6 careful on how to treat such expenses. estimate taxes of $5,000. These taxes were paid to avoid penalties for tax underpayment for 2022 . Hint: Do not include these payments in Schedule C but rather think carefully where on the return they belong. Unreimbursed Job-Related Expenses During 2022, Michael attended an Honors conference on Contract Writing for students in Boston MA. BMCC's practice is to reimburse their employees for these conferences, once all expenses have been submitted. Total expenses incurred were 3,200 , which included registration fees, hotel, transportation and meals. However, he was only reimbursed 3,000 as of December 31, 2022 because he couldn't provide receipts for the other expenses. Group Term Life Insurance Native American Justice, Inc. provides $125,000 of group term life insurance for Michael, who is not a key employee. (Hint: don't forget to consider its effect on gross income - chapter 4). Unemployment Insurance During 2022, Diana received unemployment insurance from NYS. She received Form 1099 - G which stated that she had received a total of $15,250 and her federal tax withholdings were $1,525. No state taxes were withheld. RetirementContributions During 2022, Michael contributed $7,000 to his Traditional IRA accounts, and Diana contributed $5,000 to her Roth IRA account. Assume no AGI limitation prevents the deductions. NYS Tax Refund Mr. \& Mrs. Lapin received a 1099 for $2,350 representing a 2021 NYS Tax Refund which was received in 2022. The Lapins itemized their deductions in 2021. Capital Stock Transactions Michael sold the following securities during 2022: (I) Note 5 - Sale of Residence: Mr. \& Mrs. Lapin lived in this house for many years. It was acquired in 2012 at a cost of $880,000 and it was their principal residence. Over the years they made major improvements to their home and all capital improvements are documented. Mr. \& Mrs. Lapin wish to avail themselves of the $500,000 gain exclusion under IRC Sec 121. Don't forget that sale of residence results in capital gains or losses. Expenses incurred during 2022 to be considered for Schedule A (chapter 8) Note 6-Medical Expense: Michael has weak muscles in his back. His personal physician prescribed a Nike rowing machine to try to alleviate his lower back pain Note 7-Mrs. Lapin took a trip to Miami after been diagnosed by her medical doctor with extreme stress and fatigue. She believes that the trip will elevate her condition, and that I did. Donations of Property: Paintings \& Sculpture: Donations of Property: Paintings \& Sculpture: (see Note 8) Cost $12,000 -Cost-FMV$12,00025,600 Note 8 - Contribution of Property: A reputable company appraised the painting and sculpture. Michael believes that the estimated Fair Market Value should be $40,000 and not $25,600 has declared by the appraisal company. Other Expenses Gambling losses (see Note 9) $22,500 Note 9 - Gambling Losses: Mrs. Lapin enjoys gambling in Las Vegas and she considers herself to be the "Black-Jack Doctor". During 2022 she won 15,500 and incurred losses of 38,000 . Her net gambling losses were 22,500. After her summer winnings, she has been on a consistent losing streak! Other fact: - Amara is pursuing her first degree in Business Administration. She purchased courserelated books from the campus bookstore for $1,500. Amara does not have a felony drug conviction. Her qualified tuition expenses incurred for 2022 was $12,500. However, she also was granted a scholarship of $11,500. All expenses were paid by Michael Lapin - Amara received a 1099 for $2,400 of interest issued by Wells Fargo Bank, P.O. BOX 3908 Des Moines IA 50306 - 3411, EIN 94-1000000. The interest earned was from money she had inherited from her grandparents and kept in a Certificate of Deposit at MCU. - The Lapins (Mr. and Mrs.) received a 1099-DIV from TD Ameritrade with qualified dividends of $2,650. - Due to Diana's unemployment, American Express granted her a debt forgiveness of $1,500 during 2022. - Mr. and Mrs. Lapin paid TLC Day Care $3,400 to take care of Skyla for about 2 hours after school on days that Diana was unavailable. Beware Notice: - When examining what to include in your Schedule A, consider all necessary information provided. That is to say, not because most of Schedule A items are found together, means that all. - Ensure to include all form of gross income, which is in many areas of the project. - Read carefully before making any judgment on the situation - Disregard any calculations for Alternative Minimum Tax (AMT) - Prepare the Lapin 2022 tax return using the solutions excel sheet provided. Use 20% of Net Income (from Sch. C) to compute Qualified Business Income Deduction (QBI). - Assume that any unused qualified Child Tax Credit (due to tax liability limitations) will be Additional Child Tax Credit. For example, Taxes (1040 - line 16) is 4,000 and your CTC is 5,000 , you will assume that 1,000 is ACTC. - Use the following tax forms for guidance: 1040, Sch. A, Sch. C, Sch. B, Form 8995, Sch. D, Form 8949, and Sch. SE, Form 2441, Form 8863, Sch. 8812. - You may also include any other relevant tax forms and worksheets. When calculating the Lapin's tax liability, use the tax rate schedule in your text book (or the one provided to you) and the knowledge you have gained over the semester. - Notes are required for each omission or limitation. For Example 1 - if the gains from the sale of Lapin property is included or omitted from gross income, your note should state the amount realized, the property's basis, the gains recognized, and why its included or excluded. Example 2 - if one of Lapin dependents was excluded, you must state in the note, why he/she failed the dependency test. Support your decisions by the stating the source (the text is a great source). Notes must be typed! At minimum, you should have notes for Dependents (who were excluded and why), Gross Income (any exclusions or limitations), Schedule C, Itemized deductions (medical, charitable contributions, etc.), Unreimbursed Job-Related expenses, Group Life Insurance, Capital Stock Transactions, Sale of Residence, any applicable credit(s) taken, and Gambling winnings. - The Lapin's would like to contribute 50% of their refund (if any) to their 2023 estimate taxes. Submitting your project results: A sample will be provided. Create a word or excel documents with the following information after completing the project: - List your group members - List of dependents - Schedule of Gross Income (list all that were included) - Adjustments for AGI - AGI - show how you computed it - Schedule C - simple show the Income Statement - Itemized Deductions (create a schedule of all items that were included) - Taxable Income - show how computed - Non-refundable and refundable credits - list and show how much credit did the taxpayer - earn. Tax Liability - calculate the taxpayer's taxes based upon his taxable income (use 2022 tax table - show all computation) Submit the above answer sheet, along with the typed notes to me via email. NOTE: Use 2022 tax rates to complete Lapin's 2022 Tax Return. Following is a list of information for Michael and Diana Lapin for the tax year 2022. Michael and Diana are married and have three children, Amara, Bryan, anl Skyla. They live at 120 Main Stret, Flushing NY 11425 . Michael is a Business Law Professor teaching at BMCC - CUNY, Diana works part-time for information is as follows: Dependents: Assume that all other requirements are met by each potental dependent. Michael's Previous Marriage: Michael is obligated to pay Alimony of $600 and child support of $1,000 monthly to Evelyn based upon their divorce decree dated 1/20/2020. All payments were made on time and no previous arrears existed. However, as of December 31,2022 , he had only paid a total of $13,000. Michael and Evelyn both agreed that the outstanding balance will be paid in January 2023 . The Lapin' W-2 information is as follows: Besides teaching at BMCC, Michael also has his own private consulting practice (Lapin Legal Consultancy, LLC, EIN: 55-5687541, Business code: 541110, Accounting method: Cash Basis), located at 195 Chambers street, New York, NY 10007. The income and expenses associated with his practice are as follows: Note 1 - the category office equipment includes printers, computers, fax machines, percolators, phones, microwave, and office refrigerator. The items were placed in service during 2022 . Michael is unfamiliar with the tax treatment and therefore requires your help. He is greatly concem with the tax benefits available for the costs incurred for office equipment. Hint: should he capitalized and depreciate the equipment cost, or is there another available tax treatment? Note 2 -Michael visited his mother who lives in Miami, where he spent a total of three days. He used his business card to secure a cheaper flight. The $3,000 cost includes flight and car rental services. Note 3 - Lapin Legal Consultancy, LLC, was sued by the US govemment, regarding a criminal violation of antitrust laws. He entered a no-contest plea and paid the fine of 90,000 to settle the case. Hint: Read chapter 6 careful on how to treat such expenses. estimate taxes of $5,000. These taxes were paid to avoid penalties for tax underpayment for 2022 . Hint: Do not include these payments in Schedule C but rather think carefully where on the return they belong. Unreimbursed Job-Related Expenses During 2022, Michael attended an Honors conference on Contract Writing for students in Boston MA. BMCC's practice is to reimburse their employees for these conferences, once all expenses have been submitted. Total expenses incurred were 3,200 , which included registration fees, hotel, transportation and meals. However, he was only reimbursed 3,000 as of December 31, 2022 because he couldn't provide receipts for the other expenses. Group Term Life Insurance Native American Justice, Inc. provides $125,000 of group term life insurance for Michael, who is not a key employee. (Hint: don't forget to consider its effect on gross income - chapter 4). Unemployment Insurance During 2022, Diana received unemployment insurance from NYS. She received Form 1099 - G which stated that she had received a total of $15,250 and her federal tax withholdings were $1,525. No state taxes were withheld. RetirementContributions During 2022, Michael contributed $7,000 to his Traditional IRA accounts, and Diana contributed $5,000 to her Roth IRA account. Assume no AGI limitation prevents the deductions. NYS Tax Refund Mr. \& Mrs. Lapin received a 1099 for $2,350 representing a 2021 NYS Tax Refund which was received in 2022. The Lapins itemized their deductions in 2021. Capital Stock Transactions Michael sold the following securities during 2022: (I) Note 5 - Sale of Residence: Mr. \& Mrs. Lapin lived in this house for many years. It was acquired in 2012 at a cost of $880,000 and it was their principal residence. Over the years they made major improvements to their home and all capital improvements are documented. Mr. \& Mrs. Lapin wish to avail themselves of the $500,000 gain exclusion under IRC Sec 121. Don't forget that sale of residence results in capital gains or losses. Expenses incurred during 2022 to be considered for Schedule A (chapter 8) Note 6-Medical Expense: Michael has weak muscles in his back. His personal physician prescribed a Nike rowing machine to try to alleviate his lower back pain Note 7-Mrs. Lapin took a trip to Miami after been diagnosed by her medical doctor with extreme stress and fatigue. She believes that the trip will elevate her condition, and that I did. Donations of Property: Paintings \& Sculpture: Donations of Property: Paintings \& Sculpture: (see Note 8) Cost $12,000 -Cost-FMV$12,00025,600 Note 8 - Contribution of Property: A reputable company appraised the painting and sculpture. Michael believes that the estimated Fair Market Value should be $40,000 and not $25,600 has declared by the appraisal company. Other Expenses Gambling losses (see Note 9) $22,500 Note 9 - Gambling Losses: Mrs. Lapin enjoys gambling in Las Vegas and she considers herself to be the "Black-Jack Doctor". During 2022 she won 15,500 and incurred losses of 38,000 . Her net gambling losses were 22,500. After her summer winnings, she has been on a consistent losing streak! Other fact: - Amara is pursuing her first degree in Business Administration. She purchased courserelated books from the campus bookstore for $1,500. Amara does not have a felony drug conviction. Her qualified tuition expenses incurred for 2022 was $12,500. However, she also was granted a scholarship of $11,500. All expenses were paid by Michael Lapin - Amara received a 1099 for $2,400 of interest issued by Wells Fargo Bank, P.O. BOX 3908 Des Moines IA 50306 - 3411, EIN 94-1000000. The interest earned was from money she had inherited from her grandparents and kept in a Certificate of Deposit at MCU. - The Lapins (Mr. and Mrs.) received a 1099-DIV from TD Ameritrade with qualified dividends of $2,650. - Due to Diana's unemployment, American Express granted her a debt forgiveness of $1,500 during 2022. - Mr. and Mrs. Lapin paid TLC Day Care $3,400 to take care of Skyla for about 2 hours after school on days that Diana was unavailable. Beware Notice: - When examining what to include in your Schedule A, consider all necessary information provided. That is to say, not because most of Schedule A items are found together, means that all. - Ensure to include all form of gross income, which is in many areas of the project. - Read carefully before making any judgment on the situation - Disregard any calculations for Alternative Minimum Tax (AMT) - Prepare the Lapin 2022 tax return using the solutions excel sheet provided. Use 20% of Net Income (from Sch. C) to compute Qualified Business Income Deduction (QBI). - Assume that any unused qualified Child Tax Credit (due to tax liability limitations) will be Additional Child Tax Credit. For example, Taxes (1040 - line 16) is 4,000 and your CTC is 5,000 , you will assume that 1,000 is ACTC. - Use the following tax forms for guidance: 1040, Sch. A, Sch. C, Sch. B, Form 8995, Sch. D, Form 8949, and Sch. SE, Form 2441, Form 8863, Sch. 8812. - You may also include any other relevant tax forms and worksheets. When calculating the Lapin's tax liability, use the tax rate schedule in your text book (or the one provided to you) and the knowledge you have gained over the semester. - Notes are required for each omission or limitation. For Example 1 - if the gains from the sale of Lapin property is included or omitted from gross income, your note should state the amount realized, the property's basis, the gains recognized, and why its included or excluded. Example 2 - if one of Lapin dependents was excluded, you must state in the note, why he/she failed the dependency test. Support your decisions by the stating the source (the text is a great source). Notes must be typed! At minimum, you should have notes for Dependents (who were excluded and why), Gross Income (any exclusions or limitations), Schedule C, Itemized deductions (medical, charitable contributions, etc.), Unreimbursed Job-Related expenses, Group Life Insurance, Capital Stock Transactions, Sale of Residence, any applicable credit(s) taken, and Gambling winnings. - The Lapin's would like to contribute 50% of their refund (if any) to their 2023 estimate taxes. Submitting your project results: A sample will be provided. Create a word or excel documents with the following information after completing the project: - List your group members - List of dependents - Schedule of Gross Income (list all that were included) - Adjustments for AGI - AGI - show how you computed it - Schedule C - simple show the Income Statement - Itemized Deductions (create a schedule of all items that were included) - Taxable Income - show how computed - Non-refundable and refundable credits - list and show how much credit did the taxpayer - earn. Tax Liability - calculate the taxpayer's taxes based upon his taxable income (use 2022 tax table - show all computation) Submit the above answer sheet, along with the typed notes to me via email