Required information [The following information applies to the questions displayed below.] Ken is 63 years old and unmarried. He retired at age 55 when he sold his business, Understock.com. Though Ken is retired, he is still very active. Ken reported the following financial information this year. Assume Ken files as a single taxpayer. a. Ken won $1,200 in an illegal game of poker (the game was played in Utah, where gambling is illegal). b. Ken sold 1,000 shares of stock for $32 a share. He inherited the stock two years ago. His tax basis (or investment) in the stock was $31 per share. c. Ken received $25,000 from an annuity he purchased eight years ago. He purchased the annuity, to be paid annually for 20 years, for $210,000. d. Ken received $13,000 in disability benefits for the year. He purchased the disability insurance policy last year. e. Ken decided to go back to school to learn about European history. He received a $500 cash scholarship to attend. He used $300 to pay for his books and tuition, and he applied the rest toward his new car payment. f. Ken's son, Mike, instructed his employer to make half of his final paycheck of the year payable to Ken as a gift from Mike to Ken. Ken received the check on December 30 in the amount of $1,100. g. Ken received a $610 refund of the $3,600 in state income taxes his employer withheld from his pay last year. Ken claimed $12,450 in itemized deductions last year (the standard deduction for a single filer was $12,400). h. Ken received $30,000 of interest from corporate bonds and money market accounts. 2. Complete page 1 of Form 1040 through line 9 and Schedule 1 for Ken. (Input all the values as positive numbers. Enter any non- financial information, (e.g. Names, Addresses, social security numbers) EXACTLY as they appear in any given information or Problem Statement. Use 2021 tax rules regardless of year on tax form. Ken does not wish to contribute to the Presidential Election Campaign fund or did not have any virtual currency transactions or interests.) Social security numbers: Ken: 111-22-3333 1040 for a single taxpayer. 1040 PG 1 Schedule 1 Form 1040 Page 1. Form 1040 Department of the Treasury- Internal Revenue Service (99) U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 Married filing Single Married filing separately (MFS) jointly IRS Use Only-Do not write or staple in this space. Filing Status Check only one box. Head of household (HOH) Qualifying widow(er) (QW) 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 a child but not your dependent. Your first name and middle initial Last name Ken If joint return, spouse's first name and middle initial Last name Your social security number 111-22-3333 Spouse's social security number Home address (number and street). If you have a P.O. box, see instructions. Apt. no. Presidential Election Campaign Home address (number and street). If you have a P.O. box, see instructions. City, town, or post office. If you have a foreign address, also complete spaces below. Apt. no. State ZIP code Presidential Election Campaign 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. Someone can claim: You as a dependent Foreign country name Foreign province/state/county Foreign postal code At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Standard Deduction You Spouse O Yes ONO Your spouse as a dependent Age/Blindness You: Spouse itemizes on a separate return or you were a dual-status alien Were born before January 2, 1956 Are blind Spouse: Was born before January 2, 1956 Is blind Dependents (see instructions): (2) Social security number (3) Relationship to you (4) if qualifies for (see instructions): (1) First name Last name Child tax credit Credit for other dependents If more than four dependents, see instructions and check here 1 Wages, salaries, tips, etc. Attach Form(s) W-2 2a Tax-exempt interest Attach Sch. B if required. 3a Qualified dividends 4a IRA distributions 5a Pensions and annuities Ca Canial suit anfite 2a b Taxable interest. 2b 3a b Ordinary dividends. 3b 4a b Taxable amount 4b 5a b Taxable amount 5b h Tavabla amount Ch b Taxable amount 6b 7 Standard Deduction for- Single or Married filing separately, $12,400 Married filing jointly or Qualifying widow(er), $24,800 Head of household, $18,650 If you checked any box under Standard Deduction, see instructions. 6a Social security benefits 7 Capital gain or (loss). Attach Schedule D if required. If not required, check here 8 Other income from Schedule 1, line 9 9 Add lines 1, 2b, 3b, 4b, 5b, 6b, 7, and 8. This is your total income 10 Adjustments to income: a From Schedule 1, line 22 10a b Charitable contributions if you take the standard deduction. See instructions 10b c Add lines 10a and 10b. These are your total adjustments to income 11 Subtract line 10c from line 9. This is your adjusted gross income 12 Standard deduction or itemized deductions (from Schedule A) 13 Qualified business income deduction. Attach Form 8995 or Form 8995-A 14 Add lines 12 and 13 15 Taxable income. Subtract line 14 from line 11. If zero or less, enter -0- 8 9 0 10c 11 12 13 14 15 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.