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Consider the following letter and answer Shadys question.

To my friendly student tax preparer:

Hello, my name is Shady Slim. I understand you are going to help me figure out my gross income for the year . . . whatever that means. Its been a busy year and Im a busy man, so let me give you the lowdown on my life and you can do your thing.

I was unemployed at the beginning of the year and got $2,000 in unemployment compensation. I later got a job as a manager for Roca Cola. I earned $57,000 in base salary this year. My boss gave me a $5,800 Christmas bonus check on December 22. I decided to hold on to that check and not cash it until next year, so I wont have to pay taxes on it this year. Pretty smart, huh? My jobs pretty cool. I get a lot of fringe benefits like a membership to the gym that costs $440 a year and all the Roca Cola I can drink, although I cant really drink a whole lotI figure $40 worth this year.

As part of my manager duties, I get to decide on certain things like contracts for the company. My good buddy, Eddie, runs a bottling company. I made sure that he won the bottling contract for Roca Cola for this year (even though his contract wasnt quite the best). Eddie bought me a Corvette this year for being such a good friend. The Corvette cost $58,000, and Im sure he bought it for me out of the goodness of his heart. What a great guy!

Heres a bit of good luck for the year. Upon leaving my office one day, I found $8,400 lying in the street! Well, one persons bad luck is my good luck, right?

I like to gamble a lot. I won a $28,200 poker tournament in Las Vegas this year. I also won about $5,160 over the year playing the guys at our Friday night poker game. Can you believe that I didnt lose anything this year?

Speaking of the guys, one of them hit me with his car as we were leaving the game one night. He must have been pretty ticked that he lost! I broke my right leg and my left arm. I sued the guy and got $12,600 for my medical expenses and $3,400 to pay my psychotherapist for the emotional problems I had relating to the injuries (I got really depressed!), and I won $12,800 in punitive damages. Thatll teach him that hes not so tough without his car!

Another bit of bad luck. My uncle Monty died this year. I really liked the guy, but the $240,000 inheritance I received from him made me feel a little better about the loss. I did the smart thing with the money and invested it in stocks and bonds and socked a little into my savings account. As a result, I received $640 in dividends from the stock, $240 in interest from the municipal bonds, and $340 in interest from my savings account.

My ex-wife, Alice, is still paying me alimony. Shes a lawyer who divorced me in 2015 because I was unethical or something like that. Because she was making so much money and I was unemployed at the time, the judge ruled that she had to pay ME alimony. Isnt that something? She sent me $3,800 in alimony payments this year. She still kind of likes me, though. She sent me a check for $540 as a Christmas gift this year. I didnt get her anything, though.

So there you go. Thats this year in a nutshell. Can you figure out my gross income and complete page 1 of Form 1040 (through line 7b) and Schedule 1 for me? And because youre a student, this is free, right? Thanks, I owe you one! Let me know if I can get you a six-pack of Roca Cola or something.

b-1. Complete page 1 of Form 1040 (through line 8b).

b-2. Complete Schedule 1 of Form 1040.

(99) U.S. Individual Income Tax Return OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space. Filing Status Check only one box. Single Married filing jointly Married filing separately (MFS) If you checked the MFS box, enter the name of spouse. If you checked the HOH or QW box, enter the child's name if the qualifying person is a child but not your dependent. For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320 B Form 1040(2019) SCHEDULE 1 (Form 1040 or 1040-SR) Department of the Treasury Internal Revenue Service 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. OMB No. 1545-0074 (2)(0) 19 Attachment Sequence No. 01 Name(s) shown on Form 1040 or 1040SR Your social security number At any time during 2019, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Yes No Part I Additional Income 1 Taxable refunds, credits, or offsets of state and local income taxes 2a Alimony received b Date of original divorce or separation agreement (see instructions) 3 Business income or (loss). Attach Schedule C. 4 Other gains or (losses). Attach Form 4797 5 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E . 6 Farm income or (loss). Attach Schedule F 7 Unemployment compensation 8 Other income. List type and amount 9 Combine lines 1 through 8 . Enter here and on Form 1040 or 1040 -SR, line 7a \begin{tabular}{|c|l} \hline 1 & \\ \hline 2a & \\ \hline & \\ \hline 3 & \\ \hline 4 & \\ \hline 5 & \\ \hline 6 & \\ \hline 7 & \\ \hline & \\ 8 & \\ \hline 9 & \\ \hline \end{tabular} Part II Adjustments to Income 10 Educator expenses 11 Certain business expenses of reservists, performing artists, and fee-basis government officials. Attach Form 2106 12 Health savings account deduction. Attach Form 8889 13 Moving expenses for members of the Armed Forces. Attach Form 3903 14 Deductible part of self-employment tax. Attach Schedule SE 15 Self-employed SEP, SIMPLE, and qualified plans . 16 Self-employed health insurance deduction 17 Penalty on early withdrawal of savings 18a Alimony paid. b Recipient's SSN c Date of original divorce or separation agreement (see instructions) 19 IRA deduction 20 Student loan interest deduction 21 Tuition and fees. Attach Form 8917 22 Add lines 10 through 21. These are your adjustments to income. Enter here and on Form 1040 or 1040-SR, line 8a For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 71479F Schedule 1 (Form 1040 or 1040-SR) 2019