Requirement: Determine for the marriage: a The net income subject to tax for 2020. Pedro Rodrguez Cruz and Mnica Santiago Del Valle, are married under the economic regime of society and file your income tax return as married filing jointly. Both citizens have not generated income outside of Puerto Rico, military. During taxable year 2020 they carried out the following activities. Pedro, merchant (Salesperson-retail), owns a business on his own account (sole proprietorship), Medical Equipment & Supplies dedicated to the sale and distribution of medical equipment. Pedro began operations on January 2, 2012 and works there for some 40 hours a week. The result of its operations, under the accumulation method and on a basis tax, during 2020 was the following: . . Sales $ 325,000 (not reported in 480s) Cost of goods sold 150,000" ( "Starting inventory $25,000 + Purchases $ 400,000 - ending inventory $ 275,000) Rental expense 24,000 Professional services 16,000 . The business meets all the requirements to claim all its expenses for the purposes of the regular contribution and alternate basic contribution. Submitted the "Due Diligence Checklist Fo (DDC). Apartment Pedro owns an apartment as a second residence. The apartment is located in Rincn, Puerto Rico. During 2020, the apartment was rented, for vacation purposes, throughout year. This apartment began to rent on July 1, 2015. The result of operations rent, under the cash method and on a tax basis, was the following: . . Rental Income: $ 20,000 (not reported in 480s) Repairs and maintenance 3,500 Professional Services 12,000 Property taxes 1,500 1,200 ads Electricity 2,000 Aqueduct and sewers 1,500 Other 2,000 Depreciation? 3 The business meets all the requirements to claim all its expenses for the purposes of the regular contribution and alternate basic contribution. Submitted the "Due Diligence Checklist Form" (DDC). The rented property was acquired on July 2, 2015, has a cost of $ 210,000, and has claimed depreciation between 2015 as of 2019 of $ 31,500. Its useful life is 30 years and it is depreciated under the straight line method. Personal Disbursements 1. The marriage has the following dependent: Pedrito Rodrguez Lpez, Pedro's grandson, who was born on August 15, 2010. 2. Pedro made four (4) payments of $ 5,000 in estimated contributions during 2020 (3/31, 6/30, 9/30 and 12/31) for a total of $ 20,000. Estimated Payments Match Payments contribution estimates