Question
Russell (birthdate February 2, 1968) and Linda (birthdate August 30, 1973) Long have brought you the following information regarding their income and expenses for the
Russell (birthdate February 2, 1968) and Linda (birthdate August 30, 1973) Long have brought you the following information regarding their income and expenses for the current year. Russell owns and operates a landscaping business called Lawns and Landscapes Unlimited (EIN: 32-1456789). The business is operated out of their home, located at 1234 Cherry Lane, Nampa, ID 83687. The principal business code is 561730. Russells bookkeeper provided the following income statement from the landscaping business:
The bookkeeper provided the following additional information:
-
Donations expense is a $600 donation to the Campaign to Re-Elect Senator Ami Dahla.
-
Training includes $575 for an educational seminar on bug control. It also includes the cost for Russell to attend an online certificate program in landscaping in order to improve his skills and advertise his designation as a certified landscaper. The tuition, fees, and books cost $1,400. He also drove his personal car 57 miles round trip to Boise to take exams three times for a total of 171 miles.
-
No business gift exceeded $22 in value.
-
The subscription is for a trade magazine titled Plants Unlimited.
The business uses the cash method of accounting and has no accounts receivable or inventory held for resale.
In addition to the above expenses, the Longs have set aside one room of their house as a home office. The room is 160 square feet and their house has a total of 1,600 square feet. They pay $13,200 per year rental on their house, and the utilities amount to $1,800 for the year.
The Longs also have the following interest income for the year:
Interest from Idaho Bank and Trust bond portfolio | $44,000 |
The Longs have two dependent children, Bill (Social Security number 123-23-7654) and Martha (Social Security number 345-67-8654). Both Bill and Martha are full-time high school students, ages 17 and 18, respectively, and each can be claimed for the $500 other dependent credit. Russells Social Security number is 664-98-5678 and Lindas is 554-98-3946. They made an estimated tax payment to the IRS of $2,500 on December 31, 2019.
Required: Complete the Longs federal tax return for 2019 on Form 1040, Schedule 1, Schedule 3, Schedule B, Schedule C, and Form 8829. Do not complete Form 4562 (depreciation).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started