Patrice G$.($age $41),$ SSN $111-22-1111,$ married Lauren $($age $43)$ Bergy, SSN $123-45-6789,$ in

$2016.$ Patrice and Lauren reside at $37$ Hat Trick Road, Gloucester, MA $01930.$ Patrice is selfemployed and Lauren works as a teacher in Gloucester. Patrice owns his own Consulting

business that he operates in town.

Patrice was divorced from Sarah Bergy, SSN $100-55-1234,$ in January of $2019.$ Under the

divorce agreement, Patrice is to pay Sarah $$1,000$ per month for the next $10$ years or until

Sarah$$s death, whichever occurs first. Patrice paid Sarah $$12,000$ in $2022.$ Patrice does not pay

child support to Sarah.

The following filing information relates to Patrice and Lauren:

$$ Patrice and Lauren do not elect to contribute to the Presidential Election Campaign Fund.

$$ Patrice and Lauren are calendar year taxpayers.

$$ Patrice and Lauren follow the cash basis method.

$$ Patrice and Lauren prefer that any tax overpayment to be refunded to them.

$$ Round all cents to the nearest dollar $($Round up $\mathrm{.}50$ Round down $\mathrm{.}49)$ No cents on the return.

$1.$ Lauren$$s annual salary from Gloucester Schools is included on the attached W$-2.$

$2.$ Patrice maintains a consulting practice, Patrice Bergy Training, through which he advises

clients on various training matters. Patrice rents office space in town, at $45$ Main Street,

Gloucester, MA $01931.$ He drives to some of his clients to conduct training sessions at their

location. He uses his personal car to drive to these locations. His professional activity code is

$621610$ and his employer identification number is $04-9876543.$ His clients consist of people who

desire to be trained in the mental and physical aspects of sports. Patrice collected $$205,213$ in

revenues during $2022.$ This total includes a $$4,500$ payment for work he performed in $2021$ and

does not include $$3,000$ he billed in December for work performed in late $2022.$ In addition,

Patrice has an unpaid invoice from a client for $$2,500$ for work he performed in $2020.$ This client

has not been heard from since January $2021.$ Patrice tried to locate this individual to no avail.

Patrice feels certain that he will never collect the $$2,500$ he is owed.

His business expenses for $2022$ are as follows:

Wages $($NOT COGS$)$ $$98,004$

Meals $($on perspective clients$)2,500$

Office Expense $3,550$

Advertising $4,089$

Legal Fees $950$

Utilities $6,061$

Speeding Ticket $500$

Rent $9,600$

Health Insurance $($this policy covers the whole family$)9,050$

Business portion of Repairs, Gas and Oil on Jeep $2,300$

In addition, Patrice drove his $2021$ Jeep $($purchased on February $19,2021)4,180$ miles $($assume

they were all driven prior to July $1)$ to perform consulting duties with his clients. Patrice does

not know if he can take the standard mileage, actual cost allocated to the car or both. Patrice

drove the Jeep a total of $12,500$ miles in $2022.$

Patrice utilized the following assets in his training business:

Description Date Placed Adjusted Basis when Business

of Property: into Service: Placed into Service: Use:

Equipment $3/14/19$ $$6,002100\%$

Computer $8/7/20959100\%$

Equipment $4/21/214,978100\%$

Laptop $2/19/221,934100\%$

$3$D Printer $3/28/222,299100\%$

All of the assets listed above were purchased new by Patrice on the date they were placed into

service. For Assets placed in service in $2022,$ Patrice elected the cost recovery method that

yielded the highest possible cost recovery deduction method for that year $($Patrice does not want

to take additional first year depreciation$).$

For assets purchased prior to $2022,$ all these assets were depreciated under the MACRS method

$($None were depreciated under Section $179$ or additional first year depreciation$).$ For each year

of acquisition, the highest possible deduction under MACRS was elected. Accordingly, the

expense method of $179$ and additional first year depreciation was not elected.

$3.$ On a morning walk in November $2020,$ Patrice was injured when he was sideswiped by a

delivery truck. Patrice was hospitalized for several days, and the driver of the truck was ticketed

and charged with DUI. The owner of the truck, a national parcel delivery service, was concerned

that further adverse publicity might result if the matter went to court. Consequently, the owner

offered Patrice a settlement if he would sign a release. Under the settlement, his medical

expenses were paid, and he will receive a cash award of $$325,000.$ Since he suffered no

permanent injury due to the accident, he signed the release in April $2022$ and received the

$$325,000$ settlement. The damages awarded were $$250,000$ for personal injury, $$20,000$ for

punitive damages against the driver and $$55,000$ for loss of income because his injuries

prevented him from working for some time.

$4.$ A$.$ Patrice sold no stock that was reported on Form $1099-$B

B$.$ Patrice also sold the following capital assets:

$1,000$ shares of Bar Down Corp. The shares were purchased by Patrice for

$$3,737$ on the New York Stock Exchange on J