o5 Devon Bishop, age 45, is single. He lives at 1507 Rose Lane, Albuquerque, NM Tax Computation 87131. His Social Security number is 111-11-1112. Devon does not want $3 to go to the Presidential Election Campaign Fund Devon's wife, Ariane, passed away in 2014. Devon's son, Tom, who is age 18, resides with Devon. Tom's Social Security number is 123-45-6788 Devon owns a sole proprietorship for which he uses the accrual method of accounting and maintains no inventory. His revenues and expenses for 2018 are as follows Sales revenue Cost of goods sold (based on purchases for the year) Salary expense Rent expense Utilities Telephone Advertising Bad debts Depreclation* Health insurance Accounting and legal fees $740,000 405,000 88,000 30,000 8,000 6,500 4,000 5,000 21,000 26,000 7,000 1,000 New office equipment (521,000 Devon uses the immediate expense election $18,000 for employees and 58,000 for Devon Other income received by Devon includes the following Dividend income (qualified dividends): Swan, Inc Wren, Inc. $10,000 2,000 Interest income: First National Bank Second City Bank County of Santa Fe, NM bonds 11,000 2.500 17,000 During the year, Devon and his sole proprietorship had the following propenty transactions: a. Sold Blue, Inc. stock for $45,000 on March 12, 2018. He had purchased the stock on September 5, 2015, for $50,000. b. Received an inheritance of $300,000 from his uncle, IHenry. Devon used $200,000 to purchase Green, Inc. stock on May 15, 2018, and invested $100,000 in Gold, Inc. stock on May 30, 2018. Received Orange, Inc. stock worth $9,500 as a gift from his aunt, Jane, on June 17, 2018. Her adjusted basis for the stock was $5,000. No gift taxes were paid on the transfer, Jane had purchased the stock on April 1, 2012. Devon sold the stock on July 1, 2018, for $22,000 On July 15, 2018, Devon sold one-half of the Green, Inc. stock for $10,000 c. d On July 15, 2018, Devon sold one-half of the Green, Inc. stock for $40,000 ansactions Devon was notified on August 1, 2018, that Yellow, Inc. st from a colleague on September 1, 2017, for $52,500 had become While he perceived that the investment was risky, he did not anticipate corporation would declare bankruptcy. e. ock he f. On August 15, 2018, Devon received a parcel of land in Phoenix worh in exchange for a parcel of land he owned in Tucson. Because the parcel was worth $245,000, he also received $25,000 cash. Devon's adise basis for the Tucson parcel was $210,000. He originally purchased it on k tember 18, 2015. g. On December 1, 2018, Devon sold the condominium in which he had e living for the past 20 years (1844 Lighthouse Lane, Albuquerque, NM 78 and moved into a rented townhouse. The sales price was $480,000, se expenses were $28,500, and repair expenses related to the sale nere a Devon purchased the condominium for $180,000. Devon's potential itemized deductions, exclusive of the aforementioned i tion, are as follows Medical expenses (before the 7.5% floor) Property taxes on residence State income taxes Charitable contributions Mortgage interest on residence (First National Bank) Sales taxes paid s 9,500 5,800 4,000 10,000 9,900 5,000 During the year, Devon makes estimated Federal income tax payments he makes any available elections that will reduce the tax. If you use your computations, you will need Forms 1040, 4562, 8824, and 8949 and Compute Devon's lowest net tax payable or refund due for 2018 assi A, B, C, D, and SE. o5 Devon Bishop, age 45, is single. He lives at 1507 Rose Lane, Albuquerque, NM Tax Computation 87131. His Social Security number is 111-11-1112. Devon does not want $3 to go to the Presidential Election Campaign Fund Devon's wife, Ariane, passed away in 2014. Devon's son, Tom, who is age 18, resides with Devon. Tom's Social Security number is 123-45-6788 Devon owns a sole proprietorship for which he uses the accrual method of accounting and maintains no inventory. His revenues and expenses for 2018 are as follows Sales revenue Cost of goods sold (based on purchases for the year) Salary expense Rent expense Utilities Telephone Advertising Bad debts Depreclation* Health insurance Accounting and legal fees $740,000 405,000 88,000 30,000 8,000 6,500 4,000 5,000 21,000 26,000 7,000 1,000 New office equipment (521,000 Devon uses the immediate expense election $18,000 for employees and 58,000 for Devon Other income received by Devon includes the following Dividend income (qualified dividends): Swan, Inc Wren, Inc. $10,000 2,000 Interest income: First National Bank Second City Bank County of Santa Fe, NM bonds 11,000 2.500 17,000 During the year, Devon and his sole proprietorship had the following propenty transactions: a. Sold Blue, Inc. stock for $45,000 on March 12, 2018. He had purchased the stock on September 5, 2015, for $50,000. b. Received an inheritance of $300,000 from his uncle, IHenry. Devon used $200,000 to purchase Green, Inc. stock on May 15, 2018, and invested $100,000 in Gold, Inc. stock on May 30, 2018. Received Orange, Inc. stock worth $9,500 as a gift from his aunt, Jane, on June 17, 2018. Her adjusted basis for the stock was $5,000. No gift taxes were paid on the transfer, Jane had purchased the stock on April 1, 2012. Devon sold the stock on July 1, 2018, for $22,000 On July 15, 2018, Devon sold one-half of the Green, Inc. stock for $10,000 c. d On July 15, 2018, Devon sold one-half of the Green, Inc. stock for $40,000 ansactions Devon was notified on August 1, 2018, that Yellow, Inc. st from a colleague on September 1, 2017, for $52,500 had become While he perceived that the investment was risky, he did not anticipate corporation would declare bankruptcy. e. ock he f. On August 15, 2018, Devon received a parcel of land in Phoenix worh in exchange for a parcel of land he owned in Tucson. Because the parcel was worth $245,000, he also received $25,000 cash. Devon's adise basis for the Tucson parcel was $210,000. He originally purchased it on k tember 18, 2015. g. On December 1, 2018, Devon sold the condominium in which he had e living for the past 20 years (1844 Lighthouse Lane, Albuquerque, NM 78 and moved into a rented townhouse. The sales price was $480,000, se expenses were $28,500, and repair expenses related to the sale nere a Devon purchased the condominium for $180,000. Devon's potential itemized deductions, exclusive of the aforementioned i tion, are as follows Medical expenses (before the 7.5% floor) Property taxes on residence State income taxes Charitable contributions Mortgage interest on residence (First National Bank) Sales taxes paid s 9,500 5,800 4,000 10,000 9,900 5,000 During the year, Devon makes estimated Federal income tax payments he makes any available elections that will reduce the tax. If you use your computations, you will need Forms 1040, 4562, 8824, and 8949 and Compute Devon's lowest net tax payable or refund due for 2018 assi A, B, C, D, and SE