PROBLEM 1

Walt provides you with the following information.

Bank interest income4,400

Long-term capital gain5,200

Loss on sale to solely owned Corporation(2,500)

Personal home interest expense4,000

Personal property taxes8,500

Business debt forgiven3,300

Business property taxes2,500

Tax penalties600

Business rental expense18,000Paid rent for 18 months on Oct 1

Prepaid interest income8,000Received prepaid interest for 2 years on Jan 2

Short-term capital loss9,700

State personal income taxes3,500

City of Troy bond interest5,000

Earned Income115,700

Interest paid on business loan1,400

Life insurance proceeds (death of parent)38,000

Business entertainment & meals (60/40)10,000

Political contributions1,500

Stock value increase3,800

A.Assuming that Walt is single, determine the following:

Gross Income:Adjusted Gross Income:

From AGI Deductions: Taxable Income:

Carryovers: