Required Information Comprehensive Problem 8-85 (LO 8-1, LO 8-2, LO 8-3, LO 8-4, LO 8-5) (The following information applies to the questions displayed below.) John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2020, John worked as a computer technician at a local university earning a salary of $152,000, and Sandy worked part time as a receptionist for a law firm earning a salary of $29,000. John also does some Web design work on the side and reported revenues of $4.000 and associated expenses of $750. The Fergusons received $800 in qualified dividends and a $200 refund of their state income taxes. The Fergusons always itemize thelr deductions, and their itemized deductions were well over the standard deduction amount last year. The Fergusons had qualifying Insurance for purposes of the Affordable Care Act (ACA). Use Exhibit 8-9. Tax Rate Schedule, Dividends and Capital Gains Tax Rates. 2020 AMT exemption for reference. The Fergusons reported making the following payments during the year. State Income taxes of $4.400. Federal tax withholding of $21,000. Allmony payments to John's former wife of $10,000 (divorced on 12/31/2014). Child support payments for John's child with his former wife of $4.100. $12,200 of real property taxes. Sandy was relmbursed $600 for employee business expenses she incurred. She was required to provide documentation for her expenses to her employer. $3,600 to Kid Care day care center for Samantha's care while John and Sandy worked. $14.000 interest on their home mortgage ($400,000 acquisition debt). $3.000 Interest on a $40.000 home-equity loan. They used the loan to pay for a family vacation and new car. $15.000 cash charitable contributions to qualified charities. Donation of used furniture to Goodwill. The furniture had a fair market value of $400 and cost $2.000. . Comprehensive Problem 8-85 Part b and c Complete pages 1 and 2. Schedule 1. Schedule 2 and Schedule 3 of Form 1040 and Form 6251 hn and Sandy. John and Sandy Ferguson's address is 19010 N.W. 135th Street, Miami, FL 33054. Social security numbers: John (DOB 11/07/1970): 111-11-1111 Sandy (DOB 6/24/1972): 222-22-2222 Samantha (DOB 9/30/2016): 333-33-3333 Allmony recipient: 555-55-5555 (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Page 1 of Form 1040. Use provided information and follow instructions on form. Form 1040 - U.S. Individual Income Tax Return | 2019 OMB No. 1545-0074 RS Use Only - Do not writo in this space Filling Status Sinaia Married ting jointly Marrioting separately MFS) Head of household (HOH) Dueltying widowier) (w Check only If you checked the MFS box, enter the name of spouse. If you checked the HOH Or O box, enter the sild's namo if the quelling person is one box a chid but not your dependent Your social security number Your first name and middle initial Last nama Enter as XXX-XXXXXX joint return, spouse's first name and middle in Last name Home address (number and stroot. If you have a P.O.box, see instructions. Apt.no Procidential Election Campaign City, town or post office, state and ZIP code. If you have a foreign address, also complete spaces below (see instructions). Check here it you, or your spouse if sing jointly want $3 to go to this fund. Checking a box below will not change your tax or rating You Bpouco Foreign country nama Forelos provincolate county Fornio pastoode If more than four dependents, Soutons and here Sameone can Btandard claim: | Your spouse As Acopendant You as a dependent Daduation Spouse tonians an a separate rom ar you were a dual status alien Age Blindneco You: Were born before January 2, 1956 Are blind Bpouces Was bom before senuary 2, 1956 Is bind Dependents sa Instructions: (2) Social security number 13) Relationship to you 14/ Touities for see instructions: First name Last name Enter AS XXX XXXX Chi tax credit Crest for other dependents 1 Wages salarias, tips etc. Attach Forms) W-2 2a Tax-exempt interest Taxable interest. Attach Sch. Bit 26 negured 3a Qualified dividends 3a Ordinary dividends. Attach Sch Bit 36 required Standard 4a IRA distributions 4a Taxable amount Deduction for Single or Pensions and annuities 40 Texable amount ed Married Tiling separately. 5a Social Securly bonos 5a b Taxable amount 50 $12,200 - Mamedine 6 Capital gain or loss. Attach Schedule Dif required. If not required, check here 6 jointly or Duallying 7a Other income from Scheculo 1. line 0 7a widowion $24,400 Aadlines 1, 2, 3, 4b. 40, 50, 6 and 72. This is your total como 70 0 - Head of household Ba Adjustments to income from Schedule 1. line 22 $1.350 - you checked Subtract line Bafromilne 7. This is your adjusted gross income BD 0 any box under Standard 9 Standard deduction or itemized doductions from Schedule Al 9 Deduction 10 Qualified business income deduction Attach Form 2996 of Form 1996-A 10 see instructions 11a Add lines 9 and 10 11a 0 Taxable incomo. Subtract Tina 11a tramine 115 0 For Dicolocure, Privacy Act, and Paperwork Reduction Aot Notice, ca ceparate Instruction Cat No. 113208 Form 1040 12919) THIS FORM 18 A BIMULATION OF AN OFFICIAL U.2. TAX FORM. IT IS NOT THE OFFICIAL FORM IT BELF. DO NOT USE THE FORM FOR TAX FILING 3 OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2020 MoGraw-Hill Eduoation. (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Page 2 of Form 1040. Some information does not carry over from Page 1. Form 1040 (2019 Page 2 A 12b 13b 800 14 15 16 0 17 quallying child attach Schic - you have nontaxablo combat pay, Instructions. 12a Tax (scent. Check it any trom Formis (1) 8814 12) 4972 (3) 12a Add Schedule 2 line 3, and line 128 and enter the total 13a Child tax credt or credit for other dependents 13a b Add Schedule 3107, and time 13 and enter the total 14 Subtract line 13b from ane 12b. zero or less, ontar-O- 15 Other taxes, including sof employment tax, from Schedule 2, Tine 10 16 Addes 14 and 15. This is your total tax 17 Fodera come tax withheld trom Forms W-2 and 1099 18 Other payments and refundable credits: a Eamed income credit (E10) 18a b Additional child lax credit. Attach Schedule 8812 12b C American opportunity credit from Fom 8863, In 180 d Schedule 3. ine 14 e Addlines 1er through 18d. These are your total other payments and refundable credits 19 Addnes 17 and 18. These are your total payments 20 it line 19 s more than line 16, subtract line 16 trom line 19. This the amount you overpaid 21a Amount of line 20 you want retunded to you. Ir Form 8888 attached, check here Routing number Type Checking Savings d Account number 22 Amount at the 20 you want applied to your 2020 estimated taxe 23 Amount you owe Subtract in 15 tram no 16. For details on how to pay, so instructions 24 Estimated tax penalty (see instructions 24 Do you want to low another person other than your paid preparen to decuss this roburn with the RS? Scentracions 180 0 0 20 Refund 21a Direct deposky Se instructions 23 Amount You Owe Third Party Designee Yes. Complete below No Phone Desiones name Personal contration number IPINI no Other than paid preparen Sign Here Joint return? Bos Incruotionc. Keep a copy for your reoorde Under penalties of perjury. I declare that I have examined this roburn and accompanying schedules and statements, and to the best of my knowledge and belo they are true correct and complete. Declaration of propererather than taxpayers based on all information of which preparar has any knowledge Your signatura Dato If the RS Sant you an Identity Your occupation Protection PIN, enter there sein. If the IRS sent your spouse Spouses in. If joint return, both must sign Date Spouses coupes on Identity Protection PIN, anterither SoR inst.) Phone no Emal Address Preparars signature Preparer's name Date PTIN Check Paid 3rd Party Design Preparer Firm's name Phona no Seb-employd Use Only Fim's address Firm's EN Form 1040 12010) Go to www.irs.gov/Form1040 for instructions and the latest information THIS FORM 18 A SIMULATION OF AN OFFICIAL U. 3. TAX FORM. IT 18 NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILING & OR FOR ANY PURPOBE OTHER THAN EDUCATIONAL 2020 Mo Graw-Hill Eduoation. (1040 PG 1 Schedule 1 > Allmony recipient: 555-55-5555 (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 1 of Form 1040. OMB No. 1545-0074 SCHEDULE 1 (Form 1040 or 1040-SR) 2019 Additional Income and Adjustments to Income Attach to Form 1040 or 1040-SR. Go to www.irs.gov/Form 1040 for instructions and the latest information. Department of the Treasury Internal Revenue Service Namois shown on Form 1040 ar 1040-SR Antachment Sequence No. 01 Your social security number Enter as XXX-XX-XX Yes No 1 At any time during 2018, did you receive, sel, send, exchange, or otherwise acquire any financial interest in anyvirtual currency? Part Additional Income 1 Taxable refunds, credits or otsets of state and local income taxes 2a Almony received b Date of original divorce or separation agreement ses instructions) 3 Business income or loss). Attach Schedule C 4 Other gains ar cosas). Atach Form 4797 6 Rental real estate, royalties, partnerships, corporations, trusts, etc. Attach Schedule E B Farm income ar ( is). Attach Schedule F 7 Unemployment compensation 8 Other income. Let type and amount 3 4 6 B 7 3 0 Part II Combine lines 1 through & Enter here and on Form 1040 or 1040-SR, line 7a Adjustments to Income Educatar expenses 10 10 11 11 12 12 13 18 14 Certain business expenses of reservists, performing artists, and co-basis government officials. Attach Form 2106 Health savings account deduction Attach Form 9889 Maving expenses for members of the Armed Forces. Attach For 2003 Deductible part of self-employment tax. Attach Schedule SE Sos-employed SEP SIMPLE, and qualified plans Seit-employed health insurance coduction Penalty on earty withdrawal of savings 14 16 16 18 18 17 17 189 Almony paid 18a Recipient's SSN 0 Date of original divorce or separation agreement ses instructions) 10 IRA deduction 18 20 Student loan interest deduction 20 21 Reserved for future use 21 22 Add Enes 10 through 21. These are your adjustments to income. Enter here and on Form 1040 or 1040-SR, inesa 22 0 For Paperwork Reduction Act Notice, tee your tax return Intruction Cat No. 71473F Bohedule 1 (Form 1040 or 1040-BR) 2018 THIS FORM 18 A SIMULATION OF AN OFFICIAL V.8. TAX FORM. IT IS NOT THE OFFICIAL FORM IT BELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPO BE OTHER THAN EDUCATIONAL. 2020 MoGrawHill Education. (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 2 of Form 1040. Additional Taxes OMB No. 1545-0074 SCHEDULE 2 (Form 1040 or 1040-SR) Department of the Treasury Internal Revenue Service Namest shown on Fom 1000 ar 1040-SR 2019 Attach to Form 1040 or 1040-3R. Go to www.irc.goviForm 1040 for Inctruotions and the latact Information Attachment Sequence No. 02 Your social security number 4 B Part Tax 1 Alternative minimum tax. Altach Fom 6251 2 Excess advance premium tax credit repayment Attach Form 1962 3 Adelines 1 and 2. Enter hare and include an Farm 1040 ar 1040-SR line 12 Part II Other Taxes 4 Set-employment tax. Altach Schedule SE 6 Unrepared social security and Medicare tax from Form 4127 b 8919 5 8 Additional tax on IRAs, other qualified notrement plans, and other tax-favored accounts. Attach Form 5329 it required 7a Household omployment taxes. Attach Schedule Ta b Repayment of first-time homebuyer credit from Form 5405. Autach Form 5405 required 7b 3 Taxes from: a Form 1000 b Fom 8960 8 o Instructions, arter code(s) Section 965 not tax Sabaty installment from Form 965-A 10 Add in 4 through. These are your total other taxes. Enter here and on Fom 1040 or 1040-SR, line 15 10 For Paperwork Reduction Aot Notice, Gee your tax return inctruotion. Cat No. 714780 Bohedule 2 (Form 1040 or 1040-BR) 2018 THIS FORM 18A SIMULATION OF AN OFFICIAL U.B. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL 2020 MoGraw-Hill Education. Schedule 1 Schedule 3 > (Input all the values as positive numbers. Round your Intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 3 of Form 1040. Additional Credits and Payments OMB No 1545.0074 SCHEDULE 3 (Form 1040 or 1040-SR) Department of the Treasury Internal Revenue Service Names shown on Fam 1040 or 1040-SR 2019 Attach to Form 1040 or 1040-3R. Go to www.lrs.gov/Form 100 for Instruction and the latact Information Attachment Sequence No. 03 Your social security number 3800 Part 1 Nonrefundable Credits 1 Foreign tax credit. Attach Form 1716 if required 1 2 Crede for child and dependent care expenses. Attach For 2441 2 3 Education credits from Form 9863 line 19 3 4 Retirement savings contributions Credit Attach Form 8880 4 5 Residential energy credit. Attach Form 5695 5 B Other credits from Form: b8801 6 7 Addlines 1 through G. Enter here and include on Form 1040 or 1040-SR, Inc 136 7 0 Part II Other Payments and Refundable Credits 8 2019 estimated tax payments and amount apled from 2018 natum 8 Net premium tax credit. Attach Fam 8962 9 10 Amount paid with rouest for extension to file see instructions 10 11 Excess social security and tier 1 RRTA tax with halo 11 12 Credit for federal tax on tuals. Attach Form 4136 12 13 Credits from Form: a 2439 b Reserved DES 13 14 Add Ines 8 through 13. Enter here and on Form 10400 1040-SR, no 180 14 For Paperwork Reduction Act Notice, Gee your tax return Inttruotion. Cat No. 71480G Bohedula 3 (Form 1040 or 1040-BR) 2018 THIS FORM 18 A BIMULATION OF AN OFFICIAL U.2. TAX FORM. IT IB NOT THE OFFICIAL FORM IT BELF. DO NOT USE THIS FORM FOR TAX FILING 3 OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2020 MoGraw-Hill Eduoation. d 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Form 6251 Alternative Minimum Tax-Individual ONS No. 1545-0074 1 1 n 2019 Department of the Treasury o to www.lrc.gov/Form 251 for instructions and the latest Information. Internal Revenue Service (99) Attach to Form 1040 or Form 1040NR. Attachment Sequence No. 32 Namas shown on Fam 1040 or Form 1040NR Your coolal ceourity number John and Sandy Ferguson Part 1 Alternative Minimum Taxable income (See instructions for how to complete each line.) Enter the amount from Form 100 or 1040-SR, Ene 11b, it more than zero. If Fam 1040 ar 1040-SR line 110. is zo subtract Tihes 9 and 10 of Form 1040 ar 1040-SR fram ineb of Form 1040 or 1040-SR and enter the result here. (If less than zero, enter as a negative amount. 2. It fling Schedulo A Fom 1040 or 1040-SR Lanter the taxes from Schedule A line 7: otherwise, enter the amount from Form 1040 or 1040-SR. Ino 9 b Tax round from Schedule 1 (Form 1040 1040-SR line 1 arine 20 o Investment interest expense (difference between regular tak and AMT) 20 d Depletion Difference between regular tax and AMTI 2d Net operating loss deduction from Schedulet Form 1040 or 1040-SRI. line 8. Enter as a positive amount Atornative tax net operating loss deduction 21 Interest from specified private activity bonds exempt from the regular tax 20 h Outdoor business stock, so instructions 2h 1 Exercise of incentive stock options (excess of AMT income aver regular tax income 21 Estates and trusts (amount from Schedule K-1 (Form 1041), box 12, code A) 21 * Disposition of property Difference between AMT and regular tex gain or loss) 2k Depreciation on assets placed in service after 1986 Drence between regular tax and AMTI 21 m Pasalve activities difference between AMT and reguler tax come or loss) 2m Loss.lmtons (difference between AMT and regular tax income or loss 2n O Circulation costs difference between regular tax and AMT) 20 P Long-term contracts (Gifference between AMT and regular tax income) 2p a Mining costs difference bobwoon regular tax and AMT) 29 T Research and experimental costs difference between regler tax and AMT) Income from certain installment sales before January 1, 1987 26 Intangible driving costs preference 2t 3 Cover Adjustments, including income-based related adjustments 3 Atorativo minimum taxable income. Combine lines through allt married fing separately and in 4 is more than 5733.700. see instructions. 4 $71.800. see Instructions, Part II Alternative Minimum Tax (AMT) Exemption. If you were under aga 24 at the end of 2019. see instructions.) IF your flling status Ic... AND line 4 la not over... THEN enter on line 5... Single or nead of household 510 300 $ 71.700 Married ring only or qualitying widowar! 1.020.600 111.700 Married ting separately 610 300 55.850 Itine 4 is over the amount shown above for your fling status, see Instructions B Subtract The 5 from line 4. if more than zero, go to ne 7. zero orissanter-O-here and on lines 7, 9 and 11, and go to line 10 7 you are fiing Fom 2555, secinsinctions for the amount to enter . If you reported capital gain distributions dimcly on Form 1040 or 1040-SR line 6. you reported quainted dividends on Fam 1040 ar 1040-SR, line 30, or you had again on both lines 15 and 16 of Schedule D Form 1040 or 1040-SR (refigured for the AMT, it necessaryl, complete Partul on the back and enter the amount from ine 40 here. . Al others line is $154,900 or less 1597 400 or less it married fling separately), mutiply lines by 26% (0.26) Denerwise, multiply Sne E by 28% (0.281 and subtract $3.895 $1.948 1 married ning separately from the result 8 Atormative minimum tax foreign tax credit (se instructions B Tentative minimum tax. Subtract Enes from line 7 10 Add Form 1040 oC 1040-SR, Ine 12 minus any tax from Form 4972), and Schedule 2 Form 1040 or 1040-SR), Ine 2. Subtract Subtract from the result any foreign tax credit from Schedule 3 (Form 5040 or 1040-SR line 1. If you used Schedule to figure your tax on Form 10400 1040-SR, no 12 rafigure that tax without using Schedule before completing this Ine (se instructions 10 11 AMT Subtract Tno 10 from line 9. 12om or oss, enter - Enter here and on Schedule 2 Form 1040 or 1040-SRI. In 1 11 For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 13.00G Form 9251 (2018) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM IT SELF. DO NOT USE G } EXHIBIT 8-9 Child and Dependent Care Credit Percentage If AGI is over But not over Then the percentage is S 0 $15,000 35% 15,000 17.000 34 17.000 19,000 33 19.000 21,000 32 21.000 23.000 31 23,000 25,000 30 25.000 27,000 29 27,000 29,000 28 29.000 31.000 27 31,000 33,000 26 33.000 35,000 25 35,000 37,000 24 37,000 39,000 23 39,000 41.000 22 41.000 43,000 21 43,000 No limit 20 Source: Source: Internal Revenue Code. "$ 21. Expenses For Household And Dependent Care Services Necessary For Gainful Employment." 2020 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over:But not over: $ 0 $ 9,875 $ 9,875 $ 40,125 $ 40,125 $ 85,525 $ 85,525 $163,300 $163,300 $207,350 $207,350 $518,400 $518,400 The tax is: 10% of taxable income $987.50 plus 12% of the excess over $9.875 S4.617.50 plus 22% of the excess over $40.125 $14.605.50 plus 24% of the excess over $85,525 $33,271.50 plus 32% of the excess over S163,300 S47,367.50 plus 35% of the excess over $207,350 $156,235 plus 37% of the excess over $518,400 Schedule Y-1-Married Filing Jointly or Qualifying Widow(er) If taxable income is over:But not over: The tax is: $ 0 $ 19,750 10% of taxable income $ 19,750 $ 80,250 $1,975 plus 12% of the excess over $19.750 $ 80,250 $171,050 59.235 plus 22% of the excess over $80.250 $171,050 $326,600 S29.211 plus 24% of the excess over $171,050 $326,600 $414,700 S66,543 plus 32% of the excess over $326,600 $414,700 $622,050 94.735 plus 35% of the excess over S414.700 $622,050 $167.307.50 plus 37% of the excess over $622,050 Schedule Z-Head of Household If taxable income is over:But not over: The tax is: $ 0 $ 14,100 10% of taxable income $ 14,100 $ 53.700 $1,410 plus 12% of the excess over $14.100 $ 53,700 $ 85,500 56,162 plus 22% of the excess over $53,700 $ 85,500 $163,300 $13.158 plus 24% of the excess over $85,500 $163,300 $207,350 $31,830 plus 32% of the excess over $163,300 $207,350 $518,400 S45,926 plus 35% of the excess over $207.350 $518,400 $154.793.50 plus 37% of the excess over $518.400 Schedule Y-2-Married Filing Separately If taxable income is over: But not over: The tax is: $ 0 $ 9.875 10% of taxable income $ 9,875 $ 40,125 $987.50 plus 12% of the excess over $9,875 $ 40,125 $ 85,525 54.617.50 plus 22% of the excess over $40.125 $ 85,525 $163,300 $14.605.50 plus 24% of the excess over $85.525 $163,300 $207,350 $33,271.50 plus 32% of the excess over $163,300 $207,350 $311,025 S47.367.50 plus 35% of the excess over $207.350 $311,025 $83.653.75 plus 37% of the excess over $311,025 Tax Rates for Net Capital Gains and Qualified Dividends Taxable Income Rate* Married Filing Jointly Married Filing Separately Single Head of Household Trusts and Estates 0% $0 - $80.000 $0-$40.000 $0 - $40.000 SO - $53,600 SO - $2,650 15% $80,001 - $496,600 $40,001 - $248,300 $40,001 - $441,450 $53,601 - $469,050 $2.651 - $13,150 20% $496,601+ $248,301+ $441,451+ $469,051+ $13.151+ *This rate applies to the net capital gains and qualified dividends that fall within the range of taxable income specified in the table (net capital gains and qualified dividends are included in taxable income last for this purpose). EXHIBIT 8-5 2020 AMT Exemptions Filing Status Exemption Married filing jointly Married filing separately Head of household and single $113.400 56,700 72.900 Phase-Out Begins at Phase-Out Complete for This Level of This Level of AMTI AMTI $1.036.800 $1.490.400 518.400 745,200 518.400 810.000 Required Information Comprehensive Problem 8-85 (LO 8-1, LO 8-2, LO 8-3, LO 8-4, LO 8-5) (The following information applies to the questions displayed below.) John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2020, John worked as a computer technician at a local university earning a salary of $152,000, and Sandy worked part time as a receptionist for a law firm earning a salary of $29,000. John also does some Web design work on the side and reported revenues of $4.000 and associated expenses of $750. The Fergusons received $800 in qualified dividends and a $200 refund of their state income taxes. The Fergusons always itemize thelr deductions, and their itemized deductions were well over the standard deduction amount last year. The Fergusons had qualifying Insurance for purposes of the Affordable Care Act (ACA). Use Exhibit 8-9. Tax Rate Schedule, Dividends and Capital Gains Tax Rates. 2020 AMT exemption for reference. The Fergusons reported making the following payments during the year. State Income taxes of $4.400. Federal tax withholding of $21,000. Allmony payments to John's former wife of $10,000 (divorced on 12/31/2014). Child support payments for John's child with his former wife of $4.100. $12,200 of real property taxes. Sandy was relmbursed $600 for employee business expenses she incurred. She was required to provide documentation for her expenses to her employer. $3,600 to Kid Care day care center for Samantha's care while John and Sandy worked. $14.000 interest on their home mortgage ($400,000 acquisition debt). $3.000 Interest on a $40.000 home-equity loan. They used the loan to pay for a family vacation and new car. $15.000 cash charitable contributions to qualified charities. Donation of used furniture to Goodwill. The furniture had a fair market value of $400 and cost $2.000. . Comprehensive Problem 8-85 Part b and c Complete pages 1 and 2. Schedule 1. Schedule 2 and Schedule 3 of Form 1040 and Form 6251 hn and Sandy. John and Sandy Ferguson's address is 19010 N.W. 135th Street, Miami, FL 33054. Social security numbers: John (DOB 11/07/1970): 111-11-1111 Sandy (DOB 6/24/1972): 222-22-2222 Samantha (DOB 9/30/2016): 333-33-3333 Allmony recipient: 555-55-5555 (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Page 1 of Form 1040. Use provided information and follow instructions on form. Form 1040 - U.S. Individual Income Tax Return | 2019 OMB No. 1545-0074 RS Use Only - Do not writo in this space Filling Status Sinaia Married ting jointly Marrioting separately MFS) Head of household (HOH) Dueltying widowier) (w Check only If you checked the MFS box, enter the name of spouse. If you checked the HOH Or O box, enter the sild's namo if the quelling person is one box a chid but not your dependent Your social security number Your first name and middle initial Last nama Enter as XXX-XXXXXX joint return, spouse's first name and middle in Last name Home address (number and stroot. If you have a P.O.box, see instructions. Apt.no Procidential Election Campaign City, town or post office, state and ZIP code. If you have a foreign address, also complete spaces below (see instructions). Check here it you, or your spouse if sing jointly want $3 to go to this fund. Checking a box below will not change your tax or rating You Bpouco Foreign country nama Forelos provincolate county Fornio pastoode If more than four dependents, Soutons and here Sameone can Btandard claim: | Your spouse As Acopendant You as a dependent Daduation Spouse tonians an a separate rom ar you were a dual status alien Age Blindneco You: Were born before January 2, 1956 Are blind Bpouces Was bom before senuary 2, 1956 Is bind Dependents sa Instructions: (2) Social security number 13) Relationship to you 14/ Touities for see instructions: First name Last name Enter AS XXX XXXX Chi tax credit Crest for other dependents 1 Wages salarias, tips etc. Attach Forms) W-2 2a Tax-exempt interest Taxable interest. Attach Sch. Bit 26 negured 3a Qualified dividends 3a Ordinary dividends. Attach Sch Bit 36 required Standard 4a IRA distributions 4a Taxable amount Deduction for Single or Pensions and annuities 40 Texable amount ed Married Tiling separately. 5a Social Securly bonos 5a b Taxable amount 50 $12,200 - Mamedine 6 Capital gain or loss. Attach Schedule Dif required. If not required, check here 6 jointly or Duallying 7a Other income from Scheculo 1. line 0 7a widowion $24,400 Aadlines 1, 2, 3, 4b. 40, 50, 6 and 72. This is your total como 70 0 - Head of household Ba Adjustments to income from Schedule 1. line 22 $1.350 - you checked Subtract line Bafromilne 7. This is your adjusted gross income BD 0 any box under Standard 9 Standard deduction or itemized doductions from Schedule Al 9 Deduction 10 Qualified business income deduction Attach Form 2996 of Form 1996-A 10 see instructions 11a Add lines 9 and 10 11a 0 Taxable incomo. Subtract Tina 11a tramine 115 0 For Dicolocure, Privacy Act, and Paperwork Reduction Aot Notice, ca ceparate Instruction Cat No. 113208 Form 1040 12919) THIS FORM 18 A BIMULATION OF AN OFFICIAL U.2. TAX FORM. IT IS NOT THE OFFICIAL FORM IT BELF. DO NOT USE THE FORM FOR TAX FILING 3 OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2020 MoGraw-Hill Eduoation. (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Page 2 of Form 1040. Some information does not carry over from Page 1. Form 1040 (2019 Page 2 A 12b 13b 800 14 15 16 0 17 quallying child attach Schic - you have nontaxablo combat pay, Instructions. 12a Tax (scent. Check it any trom Formis (1) 8814 12) 4972 (3) 12a Add Schedule 2 line 3, and line 128 and enter the total 13a Child tax credt or credit for other dependents 13a b Add Schedule 3107, and time 13 and enter the total 14 Subtract line 13b from ane 12b. zero or less, ontar-O- 15 Other taxes, including sof employment tax, from Schedule 2, Tine 10 16 Addes 14 and 15. This is your total tax 17 Fodera come tax withheld trom Forms W-2 and 1099 18 Other payments and refundable credits: a Eamed income credit (E10) 18a b Additional child lax credit. Attach Schedule 8812 12b C American opportunity credit from Fom 8863, In 180 d Schedule 3. ine 14 e Addlines 1er through 18d. These are your total other payments and refundable credits 19 Addnes 17 and 18. These are your total payments 20 it line 19 s more than line 16, subtract line 16 trom line 19. This the amount you overpaid 21a Amount of line 20 you want retunded to you. Ir Form 8888 attached, check here Routing number Type Checking Savings d Account number 22 Amount at the 20 you want applied to your 2020 estimated taxe 23 Amount you owe Subtract in 15 tram no 16. For details on how to pay, so instructions 24 Estimated tax penalty (see instructions 24 Do you want to low another person other than your paid preparen to decuss this roburn with the RS? Scentracions 180 0 0 20 Refund 21a Direct deposky Se instructions 23 Amount You Owe Third Party Designee Yes. Complete below No Phone Desiones name Personal contration number IPINI no Other than paid preparen Sign Here Joint return? Bos Incruotionc. Keep a copy for your reoorde Under penalties of perjury. I declare that I have examined this roburn and accompanying schedules and statements, and to the best of my knowledge and belo they are true correct and complete. Declaration of propererather than taxpayers based on all information of which preparar has any knowledge Your signatura Dato If the RS Sant you an Identity Your occupation Protection PIN, enter there sein. If the IRS sent your spouse Spouses in. If joint return, both must sign Date Spouses coupes on Identity Protection PIN, anterither SoR inst.) Phone no Emal Address Preparars signature Preparer's name Date PTIN Check Paid 3rd Party Design Preparer Firm's name Phona no Seb-employd Use Only Fim's address Firm's EN Form 1040 12010) Go to www.irs.gov/Form1040 for instructions and the latest information THIS FORM 18 A SIMULATION OF AN OFFICIAL U. 3. TAX FORM. IT 18 NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILING & OR FOR ANY PURPOBE OTHER THAN EDUCATIONAL 2020 Mo Graw-Hill Eduoation. (1040 PG 1 Schedule 1 > Allmony recipient: 555-55-5555 (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 1 of Form 1040. OMB No. 1545-0074 SCHEDULE 1 (Form 1040 or 1040-SR) 2019 Additional Income and Adjustments to Income Attach to Form 1040 or 1040-SR. Go to www.irs.gov/Form 1040 for instructions and the latest information. Department of the Treasury Internal Revenue Service Namois shown on Form 1040 ar 1040-SR Antachment Sequence No. 01 Your social security number Enter as XXX-XX-XX Yes No 1 At any time during 2018, did you receive, sel, send, exchange, or otherwise acquire any financial interest in anyvirtual currency? Part Additional Income 1 Taxable refunds, credits or otsets of state and local income taxes 2a Almony received b Date of original divorce or separation agreement ses instructions) 3 Business income or loss). Attach Schedule C 4 Other gains ar cosas). Atach Form 4797 6 Rental real estate, royalties, partnerships, corporations, trusts, etc. Attach Schedule E B Farm income ar ( is). Attach Schedule F 7 Unemployment compensation 8 Other income. Let type and amount 3 4 6 B 7 3 0 Part II Combine lines 1 through & Enter here and on Form 1040 or 1040-SR, line 7a Adjustments to Income Educatar expenses 10 10 11 11 12 12 13 18 14 Certain business expenses of reservists, performing artists, and co-basis government officials. Attach Form 2106 Health savings account deduction Attach Form 9889 Maving expenses for members of the Armed Forces. Attach For 2003 Deductible part of self-employment tax. Attach Schedule SE Sos-employed SEP SIMPLE, and qualified plans Seit-employed health insurance coduction Penalty on earty withdrawal of savings 14 16 16 18 18 17 17 189 Almony paid 18a Recipient's SSN 0 Date of original divorce or separation agreement ses instructions) 10 IRA deduction 18 20 Student loan interest deduction 20 21 Reserved for future use 21 22 Add Enes 10 through 21. These are your adjustments to income. Enter here and on Form 1040 or 1040-SR, inesa 22 0 For Paperwork Reduction Act Notice, tee your tax return Intruction Cat No. 71473F Bohedule 1 (Form 1040 or 1040-BR) 2018 THIS FORM 18 A SIMULATION OF AN OFFICIAL V.8. TAX FORM. IT IS NOT THE OFFICIAL FORM IT BELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPO BE OTHER THAN EDUCATIONAL. 2020 MoGrawHill Education. (Input all the values as positive numbers. Round your intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 2 of Form 1040. Additional Taxes OMB No. 1545-0074 SCHEDULE 2 (Form 1040 or 1040-SR) Department of the Treasury Internal Revenue Service Namest shown on Fom 1000 ar 1040-SR 2019 Attach to Form 1040 or 1040-3R. Go to www.irc.goviForm 1040 for Inctruotions and the latact Information Attachment Sequence No. 02 Your social security number 4 B Part Tax 1 Alternative minimum tax. Altach Fom 6251 2 Excess advance premium tax credit repayment Attach Form 1962 3 Adelines 1 and 2. Enter hare and include an Farm 1040 ar 1040-SR line 12 Part II Other Taxes 4 Set-employment tax. Altach Schedule SE 6 Unrepared social security and Medicare tax from Form 4127 b 8919 5 8 Additional tax on IRAs, other qualified notrement plans, and other tax-favored accounts. Attach Form 5329 it required 7a Household omployment taxes. Attach Schedule Ta b Repayment of first-time homebuyer credit from Form 5405. Autach Form 5405 required 7b 3 Taxes from: a Form 1000 b Fom 8960 8 o Instructions, arter code(s) Section 965 not tax Sabaty installment from Form 965-A 10 Add in 4 through. These are your total other taxes. Enter here and on Fom 1040 or 1040-SR, line 15 10 For Paperwork Reduction Aot Notice, Gee your tax return inctruotion. Cat No. 714780 Bohedule 2 (Form 1040 or 1040-BR) 2018 THIS FORM 18A SIMULATION OF AN OFFICIAL U.B. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL 2020 MoGraw-Hill Education. Schedule 1 Schedule 3 > (Input all the values as positive numbers. Round your Intermediate calculations and final answers to the nearest whole dollar. Use 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Schedule 3 of Form 1040. Additional Credits and Payments OMB No 1545.0074 SCHEDULE 3 (Form 1040 or 1040-SR) Department of the Treasury Internal Revenue Service Names shown on Fam 1040 or 1040-SR 2019 Attach to Form 1040 or 1040-3R. Go to www.lrs.gov/Form 100 for Instruction and the latact Information Attachment Sequence No. 03 Your social security number 3800 Part 1 Nonrefundable Credits 1 Foreign tax credit. Attach Form 1716 if required 1 2 Crede for child and dependent care expenses. Attach For 2441 2 3 Education credits from Form 9863 line 19 3 4 Retirement savings contributions Credit Attach Form 8880 4 5 Residential energy credit. Attach Form 5695 5 B Other credits from Form: b8801 6 7 Addlines 1 through G. Enter here and include on Form 1040 or 1040-SR, Inc 136 7 0 Part II Other Payments and Refundable Credits 8 2019 estimated tax payments and amount apled from 2018 natum 8 Net premium tax credit. Attach Fam 8962 9 10 Amount paid with rouest for extension to file see instructions 10 11 Excess social security and tier 1 RRTA tax with halo 11 12 Credit for federal tax on tuals. Attach Form 4136 12 13 Credits from Form: a 2439 b Reserved DES 13 14 Add Ines 8 through 13. Enter here and on Form 10400 1040-SR, no 180 14 For Paperwork Reduction Act Notice, Gee your tax return Inttruotion. Cat No. 71480G Bohedula 3 (Form 1040 or 1040-BR) 2018 THIS FORM 18 A BIMULATION OF AN OFFICIAL U.2. TAX FORM. IT IB NOT THE OFFICIAL FORM IT BELF. DO NOT USE THIS FORM FOR TAX FILING 3 OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. 2020 MoGraw-Hill Eduoation. d 2020 tax rules regardless of year on tax form.) 1040 for a couple Married Filing Jointly with two dependents. 1040 PG 1 1040 PG 2 Schedule 1 Schedule 2 Schedule 3 6251 PG 1 Form 6251 Alternative Minimum Tax-Individual ONS No. 1545-0074 1 1 n 2019 Department of the Treasury o to www.lrc.gov/Form 251 for instructions and the latest Information. Internal Revenue Service (99) Attach to Form 1040 or Form 1040NR. Attachment Sequence No. 32 Namas shown on Fam 1040 or Form 1040NR Your coolal ceourity number John and Sandy Ferguson Part 1 Alternative Minimum Taxable income (See instructions for how to complete each line.) Enter the amount from Form 100 or 1040-SR, Ene 11b, it more than zero. If Fam 1040 ar 1040-SR line 110. is zo subtract Tihes 9 and 10 of Form 1040 ar 1040-SR fram ineb of Form 1040 or 1040-SR and enter the result here. (If less than zero, enter as a negative amount. 2. It fling Schedulo A Fom 1040 or 1040-SR Lanter the taxes from Schedule A line 7: otherwise, enter the amount from Form 1040 or 1040-SR. Ino 9 b Tax round from Schedule 1 (Form 1040 1040-SR line 1 arine 20 o Investment interest expense (difference between regular tak and AMT) 20 d Depletion Difference between regular tax and AMTI 2d Net operating loss deduction from Schedulet Form 1040 or 1040-SRI. line 8. Enter as a positive amount Atornative tax net operating loss deduction 21 Interest from specified private activity bonds exempt from the regular tax 20 h Outdoor business stock, so instructions 2h 1 Exercise of incentive stock options (excess of AMT income aver regular tax income 21 Estates and trusts (amount from Schedule K-1 (Form 1041), box 12, code A) 21 * Disposition of property Difference between AMT and regular tex gain or loss) 2k Depreciation on assets placed in service after 1986 Drence between regular tax and AMTI 21 m Pasalve activities difference between AMT and reguler tax come or loss) 2m Loss.lmtons (difference between AMT and regular tax income or loss 2n O Circulation costs difference between regular tax and AMT) 20 P Long-term contracts (Gifference between AMT and regular tax income) 2p a Mining costs difference bobwoon regular tax and AMT) 29 T Research and experimental costs difference between regler tax and AMT) Income from certain installment sales before January 1, 1987 26 Intangible driving costs preference 2t 3 Cover Adjustments, including income-based related adjustments 3 Atorativo minimum taxable income. Combine lines through allt married fing separately and in 4 is more than 5733.700. see instructions. 4 $71.800. see Instructions, Part II Alternative Minimum Tax (AMT) Exemption. If you were under aga 24 at the end of 2019. see instructions.) IF your flling status Ic... AND line 4 la not over... THEN enter on line 5... Single or nead of household 510 300 $ 71.700 Married ring only or qualitying widowar! 1.020.600 111.700 Married ting separately 610 300 55.850 Itine 4 is over the amount shown above for your fling status, see Instructions B Subtract The 5 from line 4. if more than zero, go to ne 7. zero orissanter-O-here and on lines 7, 9 and 11, and go to line 10 7 you are fiing Fom 2555, secinsinctions for the amount to enter . If you reported capital gain distributions dimcly on Form 1040 or 1040-SR line 6. you reported quainted dividends on Fam 1040 ar 1040-SR, line 30, or you had again on both lines 15 and 16 of Schedule D Form 1040 or 1040-SR (refigured for the AMT, it necessaryl, complete Partul on the back and enter the amount from ine 40 here. . Al others line is $154,900 or less 1597 400 or less it married fling separately), mutiply lines by 26% (0.26) Denerwise, multiply Sne E by 28% (0.281 and subtract $3.895 $1.948 1 married ning separately from the result 8 Atormative minimum tax foreign tax credit (se instructions B Tentative minimum tax. Subtract Enes from line 7 10 Add Form 1040 oC 1040-SR, Ine 12 minus any tax from Form 4972), and Schedule 2 Form 1040 or 1040-SR), Ine 2. Subtract Subtract from the result any foreign tax credit from Schedule 3 (Form 5040 or 1040-SR line 1. If you used Schedule to figure your tax on Form 10400 1040-SR, no 12 rafigure that tax without using Schedule before completing this Ine (se instructions 10 11 AMT Subtract Tno 10 from line 9. 12om or oss, enter - Enter here and on Schedule 2 Form 1040 or 1040-SRI. In 1 11 For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 13.00G Form 9251 (2018) THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM IT SELF. DO NOT USE G } EXHIBIT 8-9 Child and Dependent Care Credit Percentage If AGI is over But not over Then the percentage is S 0 $15,000 35% 15,000 17.000 34 17.000 19,000 33 19.000 21,000 32 21.000 23.000 31 23,000 25,000 30 25.000 27,000 29 27,000 29,000 28 29.000 31.000 27 31,000 33,000 26 33.000 35,000 25 35,000 37,000 24 37,000 39,000 23 39,000 41.000 22 41.000 43,000 21 43,000 No limit 20 Source: Source: Internal Revenue Code. "$ 21. Expenses For Household And Dependent Care Services Necessary For Gainful Employment." 2020 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over:But not over: $ 0 $ 9,875 $ 9,875 $ 40,125 $ 40,125 $ 85,525 $ 85,525 $163,300 $163,300 $207,350 $207,350 $518,400 $518,400 The tax is: 10% of taxable income $987.50 plus 12% of the excess over $9.875 S4.617.50 plus 22% of the excess over $40.125 $14.605.50 plus 24% of the excess over $85,525 $33,271.50 plus 32% of the excess over S163,300 S47,367.50 plus 35% of the excess over $207,350 $156,235 plus 37% of the excess over $518,400 Schedule Y-1-Married Filing Jointly or Qualifying Widow(er) If taxable income is over:But not over: The tax is: $ 0 $ 19,750 10% of taxable income $ 19,750 $ 80,250 $1,975 plus 12% of the excess over $19.750 $ 80,250 $171,050 59.235 plus 22% of the excess over $80.250 $171,050 $326,600 S29.211 plus 24% of the excess over $171,050 $326,600 $414,700 S66,543 plus 32% of the excess over $326,600 $414,700 $622,050 94.735 plus 35% of the excess over S414.700 $622,050 $167.307.50 plus 37% of the excess over $622,050 Schedule Z-Head of Household If taxable income is over:But not over: The tax is: $ 0 $ 14,100 10% of taxable income $ 14,100 $ 53.700 $1,410 plus 12% of the excess over $14.100 $ 53,700 $ 85,500 56,162 plus 22% of the excess over $53,700 $ 85,500 $163,300 $13.158 plus 24% of the excess over $85,500 $163,300 $207,350 $31,830 plus 32% of the excess over $163,300 $207,350 $518,400 S45,926 plus 35% of the excess over $207.350 $518,400 $154.793.50 plus 37% of the excess over $518.400 Schedule Y-2-Married Filing Separately If taxable income is over: But not over: The tax is: $ 0 $ 9.875 10% of taxable income $ 9,875 $ 40,125 $987.50 plus 12% of the excess over $9,875 $ 40,125 $ 85,525 54.617.50 plus 22% of the excess over $40.125 $ 85,525 $163,300 $14.605.50 plus 24% of the excess over $85.525 $163,300 $207,350 $33,271.50 plus 32% of the excess over $163,300 $207,350 $311,025 S47.367.50 plus 35% of the excess over $207.350 $311,025 $83.653.75 plus 37% of the excess over $311,025 Tax Rates for Net Capital Gains and Qualified Dividends Taxable Income Rate* Married Filing Jointly Married Filing Separately Single Head of Household Trusts and Estates 0% $0 - $80.000 $0-$40.000 $0 - $40.000 SO - $53,600 SO - $2,650 15% $80,001 - $496,600 $40,001 - $248,300 $40,001 - $441,450 $53,601 - $469,050 $2.651 - $13,150 20% $496,601+ $248,301+ $441,451+ $469,051+ $13.151+ *This rate applies to the net capital gains and qualified dividends that fall within the range of taxable income specified in the table (net capital gains and qualified dividends are included in taxable income last for this purpose). EXHIBIT 8-5 2020 AMT Exemptions Filing Status Exemption Married filing jointly Married filing separately Head of household and single $113.400 56,700 72.900 Phase-Out Begins at Phase-Out Complete for This Level of This Level of AMTI AMTI $1.036.800 $1.490.400 518.400 745,200 518.400 810.000