Please show all the forms and calculations. Thank you!!!

Use the following information to complete Shaun and Camille Hernandez's 2019 federal income tax return. This project is entirely independent from the previous project. Please use the 2019 draft tax forms to complete the project. To the extent you need to use an online IRS calculator and the 2019 version is not available, you may use 2018. Ignore the requirement to attach the Form(s) W-2 to the Form 1040. If required information is missing, use reasonable assumptions to fill in the gaps; otherwise, post a question to the appropriate discussion board. Note: when computing the tax liability, use the method we used in class, not the IRS tax tables. Facts: Shaun (age 42) and Camille Hernandez (age 31) are married and live in Coral Gables, Florida. The Hernandezs have three children, all from Shaun's previous marriage: Charlie (age 20). Lucy (age 17), and Marcy (age 14). Marcy and Lucy live at home and their parents provide for all of their needs. Charlie does not live at home but receives more than half of his support from his parents. The Hernandezs provided the following information: Shaun's social security number is 987-65-4321 Camille's social security number is 999-88-7777 Charlie's social security number is 123-45-6789 (earns gross income of $8,600) Lucy's social security number is 111-22-3333 (earns gross income of $3,000) Marcy's social security number is 222-33-4444 (earns gross income of $0) The Hernandezs current mailing address is 100 Epic Avenue, Coral Gables, FL 33124 Shaun is a newspaper editor at the Miami Herald but also works for himself as a part-time travel agent. He received a W-2 from the Miami Herald reporting the following information (details on his travel agency are provided later): 1. Wages: 2. Federal Income Tax Withheld: 3. Social Security Wages: 4. Social Security Tax Withheld: 5. Medicare Wages: 6. Medicare Tax Withheld: 17. State Tax Withheld: S142,000 $29,560 $132.900 $8,240 $150,000 $2.172 $0 (Florida does not impose income tax) Shaun contributed $12,000 to his employer's traditional 401(k). Camille is a musician (violin and fiddle). For the first three months of the year, she was employed by Sixth Symphony. However, she resigned from her position with Sixth Symphony to pursue her solo fiddle career. She conducts business as a sole proprietorship, named First Fiddle (EIN 20-7777777). She started her solo business on January 1, 2019 (part time at first) and is located at 5150 Syco Street, Miami, Florida 33125. Camille received a W-2 from Sixth Symphony with the following information: 1. Wages: 2. Federal Income Tax Withheld: 3. Social Security Wages: 4. Social Security Tax Withheld: 5. Medicare Wages: 6. Medicare Tax Withheld: 17. State Tax Withheld: $64.350 $8,890 $65.000 $4,030 $65,000 $943 SO (Florida does not impose income tax) The W-2 also notes that Camille contributed $4,650 to her traditional 401(k). Camille reported the following information for her business activities (she uses the cash method of accounting): Revenues: Cash receipts Total revenue 356,000 356,000 Expenses: Advertising General business insurance Office Studio rent Equipment leases - office equipment Business meals Entertainment Wages for roadies Taxes and licenses Travel expenses (hotel, transportation) Employee health insurance Employee benefit programs Utilities Print and copy supplies Legal and professional fees Total Expenses 5,000 7,210 15,000 8,122 4,524 8,905 47,000 12,870 42,119 15,180 4,568 9,425 4,800 5.550 190,273 First Fiddle purchased and placed in service the following fixed assets during the year: Item Computers Printers Fiddles Date Purchased November 1 June 1 March 18 Amount $4,800 $3,375 $37,000 First Fiddle does not elect out of bonus depreciation and wants to take Section 179 expensing in a way that maximizes the current year depreciation (including 179 expense). First Fiddle does not have an audited financial statement. Camille worked part-time on First Fiddle's business activities until she finished her employment with Sixth Symphony early in the year. Camille worked full-time on First Fiddle's business activities for the rest of the year. Camille toured extensively, mainly fiddling for formerly famous musicians. While on tour, she scored autographs from and photos with: Charlie Daniels, Radney Foster, Ricky Skaggs, and Allison Krauss. Unfortunately these had no monetary value. First Fiddle filed Forms 1099 for payments made to contractors when required to do so. Shaun and Camille paid $15,265 for health insurance for the family (for the time she was working at First Fiddle). This amount is not included in the totals for First Fiddle above. Neither Shaun nor Camille had access to employer-provided health insurance during the year while they were paying the premiums for this policy. In need of cash to support First Fiddle, in February, Camille withdrew $22.000 from her traditional 401(k) account. She received a Form 1099-R with the following information: 1. Gross Distribution: $21,000 2a. Taxable Amount: $21,000 4. Federal Income Tax Withheld: $2,100 7. Distribution code: Turning to Shaun's business, Shaun always dreamed of traveling to Mexico, which led him to pursue a side gig as a travel agent. Shaun received a Form 1099-Misc from his largest client reporting that he received $6,435 from this client during 2019 as payment for his travel services. Shaun received an additional $17,018 from clients who were not required to issue Shaun a Form 1099. Shaun started his travel agent service in 2016 and he uses the cash method of accounting. He is the only person performing services in the business. He did not make any payments that require him to file a Form 1099. During the tax year, Shaun paid the following business-related expenses: Printer Paper $840 Printer Toner $1.775 Miscellaneous supplies $874 Advertising $2.347 Professional subscriptions $832 Meals $580 On April 17, 2019 Shaun purchased a new laptop computer for his business at a cost of $3,457. On the same day, he sold his old laptop for $850. It was originally purchased for $2,700 on June 1, 2016 (it was the only asset he purchased in 2016; he did not take 179 or bonus depreciation on the old laptop). Shaun also purchased a new laser printer/photocopier combination at a cost of $655 on the same date. In April, Shaun purchased computer software to use in his business for $549. These assets are used entirely in Shaun's business (there is no personal use). Assume this property is not "listed property. Shaun does not elect out of bonus depreciation. Shaun does not want to use any Section 179 expensing, even if it would be beneficial to allocate it to his assets instead of, or in addition to, Camille's assets. Shaun capitalizes these assets for financial accounting purposes and does not have an audited financial statement. Shaun owns a 1987 Chevy Camaro. He started to use the Camaro for his business on January 1, 2016. He drove 3,442 business miles during 2019 (he has documentation to verify). He drove the vehicle for a total of 12,396 miles during the year. He also has access to another vehicle (Camille's) that he can use for personal purposes. He paid $1,500 of property taxes on the Camaro. He uses the standard mileage rate to deduct operating expenses on the car. The Hernandez family's residence is 2,400 square feet. The purchase price of the residence was $342.000 (building value was $100.000 and the lot value was $242.000). The mortgage balance is currently $300,000. Camille forced Shaun to work from home for his travel agent business; as such, Shaun used one room (240 square feet) exclusively for his travel agent business. Expenses relating to the residence were as follows: Mortgage Interest ($300,000 loan balance, reported on a Form 1098) Property taxes Utilities Homeowners Insurance $18.382 $7.450 $9,487 $1,900 In addition to the primary mortgage on the home, the Hernandezs borrowed $100,000 on a home equity line of credit ("HELOC") against their home. They received a Form 1098 with the following information relating to the line of credit: Mortgage interest: $3.960 They used the funds from the home equity line of credit to purchase fancy clothes and get apology gifts for Sixth Symphony, since their relationship would never be the same. Camille owns 20 acres of vacant ground within the city limits of Los Angeles. Camille acquired the land as a gift from her parents on July 1, 2012. The land was valued at $58,000 per acre on the date of the gift. Her parents purchased the land on January 1, 1991 at a price of $17,000 per acre. Camille has held this land as an investment since she received it. For 2019, she paid $6,880 of property tax on the land. On September 15, 2019 Camille exchanged this land with a development company that plans to develop the 20 acres (Camille and the development company are not related). In exchange for the 20 acres, Camille received a condominium in Hollywood that was valued at $1,260.000. For purposes of depreciation, the building is valued at $460,000 and the land is valued at $800,000. The condominium is located at 90210 Melrose Place, Unit A. Los Angeles, California 90069. Immediately following the exchange, Camille made the condo available for rent. Camille first rented out the Melrose Place unit on November 1, 2019. The revenue and expenses from the rental unit from November through December is as follows: Rental revenue HOA fee expense Property taxes paid Utilities expense $71,700 $9.999 $13,750 $890 No Form(s) 1099 were required to be filed for this rental. The Hernandezs also received Forms 1099 for the year containing the following information: 1099-INT - Death Valley City Bonds 8. Tax-Exempt Interest: $8,200 9. Private Activity Bond Interest: $1,400 1099-INT - First Bank of the Rich and Famous 1. Interest Income $3,703 1099-INT - Decatur School District 8. Tax-Exempt Interest $8,050 1099-INT - Department of the Treasury - U.S. Treasury Bond 3. Int on U.S. Savings Bonds & Treas. Obligations $4,500 1099-INT - Rio Tinto Diamonds 1. Interest Income $2,600 1099-DIV - Disney, Inc. la. Ordinary Dividends 1b. Qualified Dividends $3,000 $3,000 1099-DIV - Oh Na Na Na Corporation la. Ordinary Dividends $2,500 1b. Qualified Dividends $2,500 1099-DIV - Oh La La La Corporation 1a. Ordinary Dividends $3,500 16. Qualified Dividends $3,500 The Hernandezs did not own, control. or manage any foreign bank accounts nor were they a grantor or beneficiary of a foreign trust during the tax year. The Hernandezs also sold stock during the year. They purchased 2,000 shares of GE stock on the 8th of November 2010 for $32,000 and sold all of the stock on August 14 2019 for $18,000. They received the proper 1099-B forms from their broker, who indicated that the basis in the stock was not reported to the IRS (because it was purchased prior to the implementation of basis reporting) In his spare time, Shaun illustrates cartoons (he enjoys reading the comics in the Herald). He draws a cartoon about a peanut named Karlie Green and her pet bird Stockwood. He sold some of his comics to a website for $800 this year. He spent $2,700 on art supplies (paper, ink, etc.) this year to support his illustrating activity. While Camille was away, Marcy decided it was a good idea to try to electrify Camille's old fiddle. The fiddle was completely destroyed (before destruction, tax basis = 0 & FMV = $2,000). Use the following information to complete Shaun and Camille Hernandez's 2019 federal income tax return. This project is entirely independent from the previous project. Please use the 2019 draft tax forms to complete the project. To the extent you need to use an online IRS calculator and the 2019 version is not available, you may use 2018. Ignore the requirement to attach the Form(s) W-2 to the Form 1040. If required information is missing, use reasonable assumptions to fill in the gaps; otherwise, post a question to the appropriate discussion board. Note: when computing the tax liability, use the method we used in class, not the IRS tax tables. Facts: Shaun (age 42) and Camille Hernandez (age 31) are married and live in Coral Gables, Florida. The Hernandezs have three children, all from Shaun's previous marriage: Charlie (age 20). Lucy (age 17), and Marcy (age 14). Marcy and Lucy live at home and their parents provide for all of their needs. Charlie does not live at home but receives more than half of his support from his parents. The Hernandezs provided the following information: Shaun's social security number is 987-65-4321 Camille's social security number is 999-88-7777 Charlie's social security number is 123-45-6789 (earns gross income of $8,600) Lucy's social security number is 111-22-3333 (earns gross income of $3,000) Marcy's social security number is 222-33-4444 (earns gross income of $0) The Hernandezs current mailing address is 100 Epic Avenue, Coral Gables, FL 33124 Shaun is a newspaper editor at the Miami Herald but also works for himself as a part-time travel agent. He received a W-2 from the Miami Herald reporting the following information (details on his travel agency are provided later): 1. Wages: 2. Federal Income Tax Withheld: 3. Social Security Wages: 4. Social Security Tax Withheld: 5. Medicare Wages: 6. Medicare Tax Withheld: 17. State Tax Withheld: S142,000 $29,560 $132.900 $8,240 $150,000 $2.172 $0 (Florida does not impose income tax) Shaun contributed $12,000 to his employer's traditional 401(k). Camille is a musician (violin and fiddle). For the first three months of the year, she was employed by Sixth Symphony. However, she resigned from her position with Sixth Symphony to pursue her solo fiddle career. She conducts business as a sole proprietorship, named First Fiddle (EIN 20-7777777). She started her solo business on January 1, 2019 (part time at first) and is located at 5150 Syco Street, Miami, Florida 33125. Camille received a W-2 from Sixth Symphony with the following information: 1. Wages: 2. Federal Income Tax Withheld: 3. Social Security Wages: 4. Social Security Tax Withheld: 5. Medicare Wages: 6. Medicare Tax Withheld: 17. State Tax Withheld: $64.350 $8,890 $65.000 $4,030 $65,000 $943 SO (Florida does not impose income tax) The W-2 also notes that Camille contributed $4,650 to her traditional 401(k). Camille reported the following information for her business activities (she uses the cash method of accounting): Revenues: Cash receipts Total revenue 356,000 356,000 Expenses: Advertising General business insurance Office Studio rent Equipment leases - office equipment Business meals Entertainment Wages for roadies Taxes and licenses Travel expenses (hotel, transportation) Employee health insurance Employee benefit programs Utilities Print and copy supplies Legal and professional fees Total Expenses 5,000 7,210 15,000 8,122 4,524 8,905 47,000 12,870 42,119 15,180 4,568 9,425 4,800 5.550 190,273 First Fiddle purchased and placed in service the following fixed assets during the year: Item Computers Printers Fiddles Date Purchased November 1 June 1 March 18 Amount $4,800 $3,375 $37,000 First Fiddle does not elect out of bonus depreciation and wants to take Section 179 expensing in a way that maximizes the current year depreciation (including 179 expense). First Fiddle does not have an audited financial statement. Camille worked part-time on First Fiddle's business activities until she finished her employment with Sixth Symphony early in the year. Camille worked full-time on First Fiddle's business activities for the rest of the year. Camille toured extensively, mainly fiddling for formerly famous musicians. While on tour, she scored autographs from and photos with: Charlie Daniels, Radney Foster, Ricky Skaggs, and Allison Krauss. Unfortunately these had no monetary value. First Fiddle filed Forms 1099 for payments made to contractors when required to do so. Shaun and Camille paid $15,265 for health insurance for the family (for the time she was working at First Fiddle). This amount is not included in the totals for First Fiddle above. Neither Shaun nor Camille had access to employer-provided health insurance during the year while they were paying the premiums for this policy. In need of cash to support First Fiddle, in February, Camille withdrew $22.000 from her traditional 401(k) account. She received a Form 1099-R with the following information: 1. Gross Distribution: $21,000 2a. Taxable Amount: $21,000 4. Federal Income Tax Withheld: $2,100 7. Distribution code: Turning to Shaun's business, Shaun always dreamed of traveling to Mexico, which led him to pursue a side gig as a travel agent. Shaun received a Form 1099-Misc from his largest client reporting that he received $6,435 from this client during 2019 as payment for his travel services. Shaun received an additional $17,018 from clients who were not required to issue Shaun a Form 1099. Shaun started his travel agent service in 2016 and he uses the cash method of accounting. He is the only person performing services in the business. He did not make any payments that require him to file a Form 1099. During the tax year, Shaun paid the following business-related expenses: Printer Paper $840 Printer Toner $1.775 Miscellaneous supplies $874 Advertising $2.347 Professional subscriptions $832 Meals $580 On April 17, 2019 Shaun purchased a new laptop computer for his business at a cost of $3,457. On the same day, he sold his old laptop for $850. It was originally purchased for $2,700 on June 1, 2016 (it was the only asset he purchased in 2016; he did not take 179 or bonus depreciation on the old laptop). Shaun also purchased a new laser printer/photocopier combination at a cost of $655 on the same date. In April, Shaun purchased computer software to use in his business for $549. These assets are used entirely in Shaun's business (there is no personal use). Assume this property is not "listed property. Shaun does not elect out of bonus depreciation. Shaun does not want to use any Section 179 expensing, even if it would be beneficial to allocate it to his assets instead of, or in addition to, Camille's assets. Shaun capitalizes these assets for financial accounting purposes and does not have an audited financial statement. Shaun owns a 1987 Chevy Camaro. He started to use the Camaro for his business on January 1, 2016. He drove 3,442 business miles during 2019 (he has documentation to verify). He drove the vehicle for a total of 12,396 miles during the year. He also has access to another vehicle (Camille's) that he can use for personal purposes. He paid $1,500 of property taxes on the Camaro. He uses the standard mileage rate to deduct operating expenses on the car. The Hernandez family's residence is 2,400 square feet. The purchase price of the residence was $342.000 (building value was $100.000 and the lot value was $242.000). The mortgage balance is currently $300,000. Camille forced Shaun to work from home for his travel agent business; as such, Shaun used one room (240 square feet) exclusively for his travel agent business. Expenses relating to the residence were as follows: Mortgage Interest ($300,000 loan balance, reported on a Form 1098) Property taxes Utilities Homeowners Insurance $18.382 $7.450 $9,487 $1,900 In addition to the primary mortgage on the home, the Hernandezs borrowed $100,000 on a home equity line of credit ("HELOC") against their home. They received a Form 1098 with the following information relating to the line of credit: Mortgage interest: $3.960 They used the funds from the home equity line of credit to purchase fancy clothes and get apology gifts for Sixth Symphony, since their relationship would never be the same. Camille owns 20 acres of vacant ground within the city limits of Los Angeles. Camille acquired the land as a gift from her parents on July 1, 2012. The land was valued at $58,000 per acre on the date of the gift. Her parents purchased the land on January 1, 1991 at a price of $17,000 per acre. Camille has held this land as an investment since she received it. For 2019, she paid $6,880 of property tax on the land. On September 15, 2019 Camille exchanged this land with a development company that plans to develop the 20 acres (Camille and the development company are not related). In exchange for the 20 acres, Camille received a condominium in Hollywood that was valued at $1,260.000. For purposes of depreciation, the building is valued at $460,000 and the land is valued at $800,000. The condominium is located at 90210 Melrose Place, Unit A. Los Angeles, California 90069. Immediately following the exchange, Camille made the condo available for rent. Camille first rented out the Melrose Place unit on November 1, 2019. The revenue and expenses from the rental unit from November through December is as follows: Rental revenue HOA fee expense Property taxes paid Utilities expense $71,700 $9.999 $13,750 $890 No Form(s) 1099 were required to be filed for this rental. The Hernandezs also received Forms 1099 for the year containing the following information: 1099-INT - Death Valley City Bonds 8. Tax-Exempt Interest: $8,200 9. Private Activity Bond Interest: $1,400 1099-INT - First Bank of the Rich and Famous 1. Interest Income $3,703 1099-INT - Decatur School District 8. Tax-Exempt Interest $8,050 1099-INT - Department of the Treasury - U.S. Treasury Bond 3. Int on U.S. Savings Bonds & Treas. Obligations $4,500 1099-INT - Rio Tinto Diamonds 1. Interest Income $2,600 1099-DIV - Disney, Inc. la. Ordinary Dividends 1b. Qualified Dividends $3,000 $3,000 1099-DIV - Oh Na Na Na Corporation la. Ordinary Dividends $2,500 1b. Qualified Dividends $2,500 1099-DIV - Oh La La La Corporation 1a. Ordinary Dividends $3,500 16. Qualified Dividends $3,500 The Hernandezs did not own, control. or manage any foreign bank accounts nor were they a grantor or beneficiary of a foreign trust during the tax year. The Hernandezs also sold stock during the year. They purchased 2,000 shares of GE stock on the 8th of November 2010 for $32,000 and sold all of the stock on August 14 2019 for $18,000. They received the proper 1099-B forms from their broker, who indicated that the basis in the stock was not reported to the IRS (because it was purchased prior to the implementation of basis reporting) In his spare time, Shaun illustrates cartoons (he enjoys reading the comics in the Herald). He draws a cartoon about a peanut named Karlie Green and her pet bird Stockwood. He sold some of his comics to a website for $800 this year. He spent $2,700 on art supplies (paper, ink, etc.) this year to support his illustrating activity. While Camille was away, Marcy decided it was a good idea to try to electrify Camille's old fiddle. The fiddle was completely destroyed (before destruction, tax basis = 0 & FMV = $2,000)