Required information Comprehensive Problem 4-56 (LO 4-1, LO 4-2, LO 4-3) (Algo) (The following information applies to the questions displayed below.) Demarco and Janine Jackson have been married for 20 years and have four children (no children under age 6 at year-end) who qualify as their dependents (Damarcus, Jasmine, Michael, and Candice). The couple received salary income of $100,950 and qualified business income of $10,000 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $247,500 and they sold it for $297,500. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,400 of itemized deductions (no charitable contributions), and they had $1,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the tax rate schedules.) Comprehensive Problem 4-56 Part b (Algo) Complete page 1, page 2, and Schedule 1 of the Jacksons' Form 1040 (use the most recent form available) Demarco and Janine Jackson's address is 19010 N.W. 135th Street, Miami, FL 33054. Social security numbers: Demarco: 123-45-6789 Son: Damarcus: 345-67-8901 Son: Michael : 567-89-0123 Janine: 234-56-7890 Daughter: Jasmine : 456-78-9012 Daughter: Candice: 678-90-1234 Form 1040 Page 1 and 2. Department of the TreasuryInternal Revenue Service (99) Form 1040 U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space. Filing Status Single Married filing jointly Married filing separately (MFS) Head of household (HOH) Qualifying widow(er) (QW) Check only If you checked the MFS box, enter the name of your spouse. If you checked the HOH or QW box, enter the child's name if the qualifying person is one box. a child but not your dependent. Your first name and middle initial Last name Your social security number Demarco Jackson 123-45-6789 Spouse's social security number If joint return, spouse's first name and middle initial Last name Jackson 234-56-7890 Janine Home address (number and street). If you have a P.O. box, see instructions. Apt. no. Presidential Election Campaign 19010 N.W. 135th Street City, town, or post office. If you have a foreign address, also complete spaces below. State ZIP code Check here if you, or your spouse if filing jointly, want $3 to go to this fund. Checking a box below will not change your tax or refund. 55555 Miami, FL 33054 Foreign country name Foreign province/state/county Foreign postal code You Spouse At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Someone can claim: You as a dependent Your spouse as a dependent Standard Deduction Age/Blindness Spouse itemizes on a separate return or you were a dual-status alien You: Were born before January 2, 1956 (see instructions): Are blind Spouse: Was born before January 2, 1956 Is blind Dependents (2) Social security number (3) Relationship to you (4) Vif qualifies for (see instructions): (1) First name Last name Child tax credit Credit for other dependents Damarcus Jackson 345-67-8901 Son If more than four dependents, see instructions and check here Jasmine Jackson 456-78-9012 567-89-0123 Daughter Son Michael Jackson Candice Jackson 678-90-1234 Daughter 1 110,950 1 Wages, salaries, tips, etc. Attach Form(s) W-2 2a Tax-exempt interest 3a Qualified dividends 2a b Taxable interest. Attach Sch. B if required. 2b 3a 3b b Ordinary dividends. b Taxable amount 4a IRA distributions 4a 4b 5a Pensions and annuities 5a b Taxable amount 5b 6a Social security benefits 6a b Taxable amount 6b 7 Capital gain or loss). Attach Schedule D if required. 7 Standard 8 Other income from Schedule 1, line 9 8 Deduction for- Single or Married 9 Add lines 1, 2, 3, 4, 5, 6, 7, and 8. This is your total income 9 110,950 filing separately, $12,400 10 Adjustments to income: Married filing jointly or Qualifying a From Schedule 1, line 22 10a widow(er), $24,800 10b Head of b Charitable contributions if you take the standard deduction. See instructions household, c Add lines 10a and 10b. These are your total adjustments to income 10c $18,650 If you checked 11 Subtract line 10c from line 9. This is your adjusted gross income 11 any box under Standard 12 Standard deduction or itemized deductions (from Schedule A) 12 Deduction, 24,800 see instructions. 13 Qualified business income deduction. Attach Form 8995 or Form 8995-A 13 2000 14 Add lines 12 and 13 14 26,800 15 Taxable income. Subtract line 14 from line 11. If zero or less, enter-O- 15 (26,800) For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2020) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2021 McGraw-Hill Education. Form 1040 Page 1 and 2. Form 1040 (2020) Page 2 18814 24972 16 17 18 19 20 21 0 22 16 Tax (see instructions). Check if any from Formis): 17 Amount from Schedule 2, line 3 23 18 Add lines 16 and 17. 19 Child tax credit or credit for other dependents 20 Amount from Schedule 3, line 7 21 Add lines 19 and 20 22 Subtract line 21 from line 18. If zero or less, enter -- 23 Other taxes, including self-employment tax, from Schedule 2. line 10 24 Add lines 22 and 23. This is your total tax 25 Federal income tax withheld from: a Formis) W-2 b Form(s) 1099 c Other forms (see Instructions) dAdd lines 25a through 25c 23 24 0 25a 25b 250 250 . If you have a qualifying child, attach Sch. EIC 26 2020 estimated tax payments and amount applied from 2019 return 26 27 Earned income credit (EIC) 27 28 . If you have nontaxable combat pay. see instructions 29 30 31 28 Additional child tax credit. Attach Schedule 8812 29 American opportunity credit from Form 8863, line 8. , 8. 30 Recovery rebate credit. See instructions 31 Amount from Schedule 3, line 13 32 Add lines 27 through 31. These are your total other payments and refundable credits 33 Add lines 25d, 26, and 32. These are your total payments 34 If line 33 is more than line 24, subtract line 24 from line 33. This is the amount you overpaid 35a Amount of line 34 you want refunded to you. If Form 8888 is attached, check here Routing number 32 0 33 0 Refund 34 0 35a 0 I Checking Savings c Type: Direct deposit? See instructions d Account number 36 Amount of line 34 you want applied to your 2021 estimated tax 36 Amount You Owe 37 Subtract line 33 from line 24. This is the amount you owe now 37 Note: Schedule H and Schedule SE filers, line 37 may not represent all of the taxes you owe for 2020. See Schedule 3, line 12e, and its instructions for details 38 Estimated tax penalty (see instructions) 38 For details on how to pay, see instructions. Third Party Designee Do you want to allow another person to discuss this return with the IRS? See instructions Yes. Complete below. No number Designee's name Phone no. Personal identification (PIN) Sign Here Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Your signature Date Your occupation If the IRS sent you an Identity Protection PIN, enter it here Joint return? See instructions. Keep a copy for your records. (see inst.) If the IRS sent your spouse an Identity Protection PIN, enter it here Spouse's signature. If a joint return, both must sign. Date Spouse's occupation (see inst.) Phone no. Email address Preparer's name Preparer's signature Date PTIN Check if: Self-employed Paid Preparer Use Only Firm's name Phone no. Firm's address Firm's EIN Go to www.irs.gov/Form 1040 for instructions and the latest information. Form 1040 (2020) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2021 McGraw-Hill Education. Required information Comprehensive Problem 4-56 (LO 4-1, LO 4-2, LO 4-3) (Algo) (The following information applies to the questions displayed below.) Demarco and Janine Jackson have been married for 20 years and have four children (no children under age 6 at year-end) who qualify as their dependents (Damarcus, Jasmine, Michael, and Candice). The couple received salary income of $100,950 and qualified business income of $10,000 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $247,500 and they sold it for $297,500. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,400 of itemized deductions (no charitable contributions), and they had $1,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the tax rate schedules.) Comprehensive Problem 4-56 Part b (Algo) Complete page 1, page 2, and Schedule 1 of the Jacksons' Form 1040 (use the most recent form available) Demarco and Janine Jackson's address is 19010 N.W. 135th Street, Miami, FL 33054. Social security numbers: Demarco: 123-45-6789 Son: Damarcus: 345-67-8901 Son: Michael : 567-89-0123 Janine: 234-56-7890 Daughter: Jasmine : 456-78-9012 Daughter: Candice: 678-90-1234 Form 1040 Page 1 and 2. Department of the TreasuryInternal Revenue Service (99) Form 1040 U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space. Filing Status Single Married filing jointly Married filing separately (MFS) Head of household (HOH) Qualifying widow(er) (QW) Check only If you checked the MFS box, enter the name of your spouse. If you checked the HOH or QW box, enter the child's name if the qualifying person is one box. a child but not your dependent. Your first name and middle initial Last name Your social security number Demarco Jackson 123-45-6789 Spouse's social security number If joint return, spouse's first name and middle initial Last name Jackson 234-56-7890 Janine Home address (number and street). If you have a P.O. box, see instructions. Apt. no. Presidential Election Campaign 19010 N.W. 135th Street City, town, or post office. If you have a foreign address, also complete spaces below. State ZIP code Check here if you, or your spouse if filing jointly, want $3 to go to this fund. Checking a box below will not change your tax or refund. 55555 Miami, FL 33054 Foreign country name Foreign province/state/county Foreign postal code You Spouse At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Someone can claim: You as a dependent Your spouse as a dependent Standard Deduction Age/Blindness Spouse itemizes on a separate return or you were a dual-status alien You: Were born before January 2, 1956 (see instructions): Are blind Spouse: Was born before January 2, 1956 Is blind Dependents (2) Social security number (3) Relationship to you (4) Vif qualifies for (see instructions): (1) First name Last name Child tax credit Credit for other dependents Damarcus Jackson 345-67-8901 Son If more than four dependents, see instructions and check here Jasmine Jackson 456-78-9012 567-89-0123 Daughter Son Michael Jackson Candice Jackson 678-90-1234 Daughter 1 110,950 1 Wages, salaries, tips, etc. Attach Form(s) W-2 2a Tax-exempt interest 3a Qualified dividends 2a b Taxable interest. Attach Sch. B if required. 2b 3a 3b b Ordinary dividends. b Taxable amount 4a IRA distributions 4a 4b 5a Pensions and annuities 5a b Taxable amount 5b 6a Social security benefits 6a b Taxable amount 6b 7 Capital gain or loss). Attach Schedule D if required. 7 Standard 8 Other income from Schedule 1, line 9 8 Deduction for- Single or Married 9 Add lines 1, 2, 3, 4, 5, 6, 7, and 8. This is your total income 9 110,950 filing separately, $12,400 10 Adjustments to income: Married filing jointly or Qualifying a From Schedule 1, line 22 10a widow(er), $24,800 10b Head of b Charitable contributions if you take the standard deduction. See instructions household, c Add lines 10a and 10b. These are your total adjustments to income 10c $18,650 If you checked 11 Subtract line 10c from line 9. This is your adjusted gross income 11 any box under Standard 12 Standard deduction or itemized deductions (from Schedule A) 12 Deduction, 24,800 see instructions. 13 Qualified business income deduction. Attach Form 8995 or Form 8995-A 13 2000 14 Add lines 12 and 13 14 26,800 15 Taxable income. Subtract line 14 from line 11. If zero or less, enter-O- 15 (26,800) For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2020) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2021 McGraw-Hill Education. Form 1040 Page 1 and 2. Form 1040 (2020) Page 2 18814 24972 16 17 18 19 20 21 0 22 16 Tax (see instructions). Check if any from Formis): 17 Amount from Schedule 2, line 3 23 18 Add lines 16 and 17. 19 Child tax credit or credit for other dependents 20 Amount from Schedule 3, line 7 21 Add lines 19 and 20 22 Subtract line 21 from line 18. If zero or less, enter -- 23 Other taxes, including self-employment tax, from Schedule 2. line 10 24 Add lines 22 and 23. This is your total tax 25 Federal income tax withheld from: a Formis) W-2 b Form(s) 1099 c Other forms (see Instructions) dAdd lines 25a through 25c 23 24 0 25a 25b 250 250 . If you have a qualifying child, attach Sch. EIC 26 2020 estimated tax payments and amount applied from 2019 return 26 27 Earned income credit (EIC) 27 28 . If you have nontaxable combat pay. see instructions 29 30 31 28 Additional child tax credit. Attach Schedule 8812 29 American opportunity credit from Form 8863, line 8. , 8. 30 Recovery rebate credit. See instructions 31 Amount from Schedule 3, line 13 32 Add lines 27 through 31. These are your total other payments and refundable credits 33 Add lines 25d, 26, and 32. These are your total payments 34 If line 33 is more than line 24, subtract line 24 from line 33. This is the amount you overpaid 35a Amount of line 34 you want refunded to you. If Form 8888 is attached, check here Routing number 32 0 33 0 Refund 34 0 35a 0 I Checking Savings c Type: Direct deposit? See instructions d Account number 36 Amount of line 34 you want applied to your 2021 estimated tax 36 Amount You Owe 37 Subtract line 33 from line 24. This is the amount you owe now 37 Note: Schedule H and Schedule SE filers, line 37 may not represent all of the taxes you owe for 2020. See Schedule 3, line 12e, and its instructions for details 38 Estimated tax penalty (see instructions) 38 For details on how to pay, see instructions. Third Party Designee Do you want to allow another person to discuss this return with the IRS? See instructions Yes. Complete below. No number Designee's name Phone no. Personal identification (PIN) Sign Here Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. Your signature Date Your occupation If the IRS sent you an Identity Protection PIN, enter it here Joint return? See instructions. Keep a copy for your records. (see inst.) If the IRS sent your spouse an Identity Protection PIN, enter it here Spouse's signature. If a joint return, both must sign. Date Spouse's occupation (see inst.) Phone no. Email address Preparer's name Preparer's signature Date PTIN Check if: Self-employed Paid Preparer Use Only Firm's name Phone no. Firm's address Firm's EIN Go to www.irs.gov/Form 1040 for instructions and the latest information. Form 1040 (2020) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2021 McGraw-Hill Education.