Scenario

You are a tax professional and have been asked to complete a tax return for new client Kenji and Suki Takahara. The Takaharas are married, rent a home, and have two young children in day care. Kenji is employed as a lawyer and Suki as an engineer. They are still paying on their student loans, but they donate to charity. Suki also contributes $5,000 to a day care flexible spending account. They will claim the standard deduction. The Takaharas provide documentation you request during their interview. To properly prepare this income tax return, you will need to apply the appropriate tax laws, regulations, and codes.

Directions

Complete an individual federal tax return for the current year. Refer to the module resources, including the IRS website, for access to the correct tax return forms.

Specifically, you should address the following rubric criteria:

1. Connect the client's information to the appropriate tax forms needed to complete the tax return.
2. Apply the relevant information from the provided taxpayer source documentation to the tax forms.
3. Assess the character of all income sources.
4. Evaluate whether the taxpayer's deductions should be itemized or not based on ethical standards for determining and communicating deductions.
5. Distinguish between the expenses connected with the client's employment that are eligible for deduction and those that are not.