Required: Based on the information provided on the following page, complete the Booths Form 1040 for 2020, including any required forms and attachments.
Seeley and Temperance Booth are married and file a joint return. Their Social Security numbers are 000-00- 1111 and 000-00-2222, respectively. Sealy and Temperance have one daughter, Christine, age 5, and one son, Hank, age 2. Christine's Social Security number is 000-00-3333 and Hank's is 000-00-4444. They live at 1212 Jefferson Dr, Bethesda, MD 20810. They report their income on the cash method. During 2020, they report the following items: $206,000 1,900 3,700 9,000 Salary Interest income from money market accounts Qualified dividend income from Reichs Corp. stock Cash contributions to charity Rental of a condominium in Annapolis: Rental income (75 days) Interest Expense Property taxes Maintenance Insurance Days of personal use 15,000 7,000 5,200 1,700 2,300 25 The address of the condo is 3737 S Figueroa St, Annapolis, MD 21401. It was purchased in 2008 for $200,000 During the year the following events also occur: a. They received a state tax refund of $600. Their total itemized deductions in 2019 were $42,792. b. On June 20, 2020, Temperance sells 400 shares of Sweets Corporation stock for $20,000. She purchased the stock on December 12, 2009 for $22,000. c. On September 19, 2020, Seeley discovers that the 4,000 shares of penny stock of Parker, Inc. he purchased on January 2 of the prior year is completely worthless. He paid $6,300 for the stock. d. Instead of accepting the $60 the utility store offers for their old dishwasher, they donate it to Goodwill on November 21, 2020. They purchased the dishwasher for $750 on March 30, 2014. The new dishwasher costs $900. e. They purchased the residence at 1212 Jefferson Dr on April 15, 2020 for $350,000. As part of the closing costs, they pay two points on the mortgage, which is interest rather than loan processing fees. This payment enables them to obtain a more favorable interest rate for the term of the loan. They also paid $8,400 in interest on the mortgage on their personal residence. f. They pay $4,100 in property taxes on their residence and $12,360 in state income taxes. g. On July 20, 2020, they donate 1,000 shares of Squint, Inc. stock to the local community college. The value of the stock on that date is $13,700. Squint, Inc. is a listed stock. They had purchased the stock on November 10, 2008 for $1,000. h. $22,000 in federal income tax was withheld during the year. i. They incur $5,000 of hospital expenses when Seeley is injured while hiking. They also spend $250 on prescriptions and $800 on follow-up doctor visits. j. Temperance paid $2,000 of student loan interest during the year. For purposes of this assignment, disregard the alternative minimum tax. Seeley and Temperance Booth are married and file a joint return. Their Social Security numbers are 000-00- 1111 and 000-00-2222, respectively. Sealy and Temperance have one daughter, Christine, age 5, and one son, Hank, age 2. Christine's Social Security number is 000-00-3333 and Hank's is 000-00-4444. They live at 1212 Jefferson Dr, Bethesda, MD 20810. They report their income on the cash method. During 2020, they report the following items: $206,000 1,900 3,700 9,000 Salary Interest income from money market accounts Qualified dividend income from Reichs Corp. stock Cash contributions to charity Rental of a condominium in Annapolis: Rental income (75 days) Interest Expense Property taxes Maintenance Insurance Days of personal use 15,000 7,000 5,200 1,700 2,300 25 The address of the condo is 3737 S Figueroa St, Annapolis, MD 21401. It was purchased in 2008 for $200,000 During the year the following events also occur: a. They received a state tax refund of $600. Their total itemized deductions in 2019 were $42,792. b. On June 20, 2020, Temperance sells 400 shares of Sweets Corporation stock for $20,000. She purchased the stock on December 12, 2009 for $22,000. c. On September 19, 2020, Seeley discovers that the 4,000 shares of penny stock of Parker, Inc. he purchased on January 2 of the prior year is completely worthless. He paid $6,300 for the stock. d. Instead of accepting the $60 the utility store offers for their old dishwasher, they donate it to Goodwill on November 21, 2020. They purchased the dishwasher for $750 on March 30, 2014. The new dishwasher costs $900. e. They purchased the residence at 1212 Jefferson Dr on April 15, 2020 for $350,000. As part of the closing costs, they pay two points on the mortgage, which is interest rather than loan processing fees. This payment enables them to obtain a more favorable interest rate for the term of the loan. They also paid $8,400 in interest on the mortgage on their personal residence. f. They pay $4,100 in property taxes on their residence and $12,360 in state income taxes. g. On July 20, 2020, they donate 1,000 shares of Squint, Inc. stock to the local community college. The value of the stock on that date is $13,700. Squint, Inc. is a listed stock. They had purchased the stock on November 10, 2008 for $1,000. h. $22,000 in federal income tax was withheld during the year. i. They incur $5,000 of hospital expenses when Seeley is injured while hiking. They also spend $250 on prescriptions and $800 on follow-up doctor visits. j. Temperance paid $2,000 of student loan interest during the year. For purposes of this assignment, disregard the alternative minimum tax
