Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Shauna Coleman is single. She is employed as an architectural designer for Streamline Design (SD). Shauna wanted to determine her taxable income for this year

Shauna Coleman is single. She is employed as an architectural designer for Streamline Design (SD). Shauna wanted to determine her taxable income for this year (2021). She correctly calculated her AGI. However, she wasnt sure how to compute the rest of her taxable income. She provided the following information with hopes that you could use it to determine her taxable income. Shauna paid $4,690 for medical expenses for care related to a broken ankle. Also, Shaunas boyfriend, Blake, drove Shauna (in her car) a total of 115 miles to the doctors office so she could receive care for her broken ankle. Shauna paid a total of $3,425 in health insurance premiums during the year (not through an exchange). SD did not reimburse any of this expense. Besides the health insurance premiums and the medical expenses for her broken ankle, Shauna had Lasik eye surgery last year and paid $3,025 for the surgery (she received no insurance reimbursement). She also incurred $460 of other medical expenses for the year. SD withheld $1,825 of state income tax, $7,520 of Social Security tax, and $14,600 of federal income tax from Shaunas paychecks throughout the year. In 2021, Shauna was due a refund of $260 for overpaying her 2020 state taxes. On her 2020 state tax return that she filed in April 2021, she applied the overpayment toward her 2021 state tax liability. She estimated that her state tax liability for 2021 will be $2,325. Shauna paid $3,225 of property taxes on her personal residence. She also paid $510 to the developer of her subdivision because he had to replace the sidewalk in certain areas of the subdivision. Shauna paid a $210 property tax based on the states estimate of the value of her car. Shauna has a home mortgage loan in the amount of $225,000 that she secured when she purchased her home. The home is worth about $405,000. Shauna paid interest of $12,400 on the loan this year. Shauna made several charitable contributions throughout the year. She contributed stock in ZYX Corporation to the Red Cross. On the date of the contribution, the fair market value of the donated shares was $1,100 and her basis in the shares was $440. Shauna originally bought the ZYX Corporation stock in 2009. Shauna also contributed $310 cash to State University and religious artifacts she has held for several years to her church. The artifacts were valued at $510 and Shaunas basis in the items was $310. Shauna had every reason to believe the church would keep them on display indefinitely. Shauna also drove 200 miles doing church-related errands for her minister. Finally, Shauna contributed $1,225 of services to her church last year. Shauna paid $260 in investment advisory fees and another $160 to have her tax return prepared (that is, she paid $160 in 2021 to have her 2020 tax return prepared). Shauna is involved in horse racing as a hobby. During the year, she won $2,525 in prize money and incurred $11,000 in expenses. She has never had a profitable year with her horse-racing activities, so she acknowledges that this is a hobby for federal income tax purposes. Shauna sustained $2,025 in gambling losses over the year (mostly horse-racing bets) and had only $210 in winnings.

image text in transcribedimage text in transcribed

This is a 3 part question. I know it's a pain in the butt, but I would greatly appreciate it if you did all 3 parts. Assume Shaunas AGI is $212,000.

1 A. Complete the 1040 Above picture. page 1/2 based on the info above

1. B Determine Shaunas taxable income.

Department of the TreasuryInternal Revenue Service (99) Form 1040 U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space Filing Status Single Married filing jointly Married filing separately (MFS) ) Head of household (HOH) O Qualifying widower) (QW) Check only 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 one box a child but not your dependent. Your first name and middle initial Last name Your social security number Shauna Coleman 111-11-1111 If joint return, spouse's first name and middle initial Spouse's social security number Last name Home address (number and street). If you have a P.O. box, see instructions. Apt. no Presidential Election Campaign 19010 N.W. 135th Street City, town, or post office. If you have a foreign address, also complete spaces below. State ZIP code Check here if you, or your spouse if filing jointly, want 53 to go to this fund. Checking a box below will not change Miami, FL 33054 your tax or refund Foreign country name Foreign province/state/county Foreign postal code You Spouse At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Yes No + Standard Someone can claim: You as a dependent Your spouse as a dependent Deduction Spouse itemizes on a separate return or you were a dual-status alien Age/Blindness You: Were born before January 2, 1958 Are blind Spouse: Was born before January 2, 1958 , 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 o 1 Wages, salaries, tips, etc. Attach Form(s) W-2 Attach Sch. Bif 2a 2b required 3a 3b b Taxable interest b Ordinary dividends b Taxable amount b Taxable amount 4a 2a Tax-exempt interest 3a Qualified dividends 4a IRA distributions 5a Pensions and annuities Ba Social security benefits 7 Capital gain or loss). Attach Schedule Dif required. If not required, check here 45 5a 5b ba b Taxable amount Bb 7 8 Other income from Schedule 1. line 9 8 9 Add lines 1, 2, 3, 4, 5, 6, 7, and 8. This is your total income 0 10 Adjustments to income: a From Schedule 1, line 22 10a Standard Deduction for- - Single or Married fling separately $12.400 Married filing jointly or Qualifying widower). S24.800 - Head of household, $18,650 . If you checked any box under Standard Deduction, see instructions 10b 3,173 100 11 0 b Charitable contributions if you take the standard deduction. See instructions c Add lines 10a and 10b. These are your total adjustments to income C 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-O- 12 13 14 0 15 0 Internal Revenue Service (99) Caution: If you are claiming a net qualified disaster loss on Form 4884, see the instructions for line 16 Name(s) shown on Form 1040 or 1040-SR Attachment Sequence No. 07 Your social security number 111-11-1111 Shauna Coleman Medical and Dental Expenses 11,618 Caution: Do not include expenses reimbursed or paid by others. 1 Medical and dental expenses (see instructions) 2 Enter amount from Form 1040 or 1040-SR, line 11 2 3 Multiply line 2 by 7.5% (0.075) 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter - - 5 State and local taxes. 11,618 Taxes You Paid a State and local income taxes or general sales taxes. You may include either income taxes or general sales taxes on line 5a, but not both. If you elect to include general sales taxes instead of income taxes 5a 5b 2,085 3,225 210 5c check this box b State and local real estate taxes (see instructions) c State and local personal property taxes d Add lines 5a through 5c e Enter the smaller of line 5d or $10,000 ($5,000 if married filing separately) 6 Other taxes. List type and amount 5d 5,520 5e 5,520 7 Add lines 5e and 6 7 5,520 Interest You Paid 8 Home mortgage interest and points. If you didn't use all of your home mortgage loan(s) to buy build, or improve your home, see instructions and check this box a Home mortgage interest and points reported to you on Form 1098. See instructions if limited 8a 12,400 Caution: Your mortgage interest deduction may be limited (see instruction) b Home mortgage interest not reported to you on Form 1098. See instructions if limited. If paid to the person from whom you bought the home, see instructions and show that person's name, identifying no., and address 8b 10 12,400 c Points not reported to you on Form 1098. See instructions for special rules 8c d Mortgage insurance premiums (see instructions). 8d e Add lines 8a through 8d. 8e 9 Investment interest. Attach Form 4952 if required. See instructions 9 10 Add lines 8e and 9 11 Gifts to 11 Gifts by cash or check. If you made any gift of $250 or more, see instructions Charity 12 Other than by cash or check. If you made any gift of $250 or more, see instructions. You must attach Form 8283 if over $500 12 Caution: If you made a gift and get a benefit 13 Carryover from prior year 13 for it, see instructions. 14 Add lines 11 through 13 Casualty and 15 Casualty and theft loss(es) from a federally declared disaster (other than net qualified disaster losses). Attach Form 4884 and enter the Theft Losses amount from line 18 of that form. See instructions 1,610 14 1,810 15 16 Otherfrom list in instructions. List type and amount Other Itemized Deductions 16 17 Add the amounts in the far right column for lines 4 through 16. Also, enter this amount on Form 1040 or 1040-SR, line 12 17 31,148 Total Itemized Deductions 18 If you elect to itemize deductions even though they are less than your standard deduction, check this box Department of the TreasuryInternal Revenue Service (99) Form 1040 U.S. Individual Income Tax Return 2020 OMB No. 1545-0074 IRS Use Only-Do not write or staple in this space Filing Status Single Married filing jointly Married filing separately (MFS) ) Head of household (HOH) O Qualifying widower) (QW) Check only 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 one box a child but not your dependent. Your first name and middle initial Last name Your social security number Shauna Coleman 111-11-1111 If joint return, spouse's first name and middle initial Spouse's social security number Last name Home address (number and street). If you have a P.O. box, see instructions. Apt. no Presidential Election Campaign 19010 N.W. 135th Street City, town, or post office. If you have a foreign address, also complete spaces below. State ZIP code Check here if you, or your spouse if filing jointly, want 53 to go to this fund. Checking a box below will not change Miami, FL 33054 your tax or refund Foreign country name Foreign province/state/county Foreign postal code You Spouse At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? Yes No + Standard Someone can claim: You as a dependent Your spouse as a dependent Deduction Spouse itemizes on a separate return or you were a dual-status alien Age/Blindness You: Were born before January 2, 1958 Are blind Spouse: Was born before January 2, 1958 , 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 o 1 Wages, salaries, tips, etc. Attach Form(s) W-2 Attach Sch. Bif 2a 2b required 3a 3b b Taxable interest b Ordinary dividends b Taxable amount b Taxable amount 4a 2a Tax-exempt interest 3a Qualified dividends 4a IRA distributions 5a Pensions and annuities Ba Social security benefits 7 Capital gain or loss). Attach Schedule Dif required. If not required, check here 45 5a 5b ba b Taxable amount Bb 7 8 Other income from Schedule 1. line 9 8 9 Add lines 1, 2, 3, 4, 5, 6, 7, and 8. This is your total income 0 10 Adjustments to income: a From Schedule 1, line 22 10a Standard Deduction for- - Single or Married fling separately $12.400 Married filing jointly or Qualifying widower). S24.800 - Head of household, $18,650 . If you checked any box under Standard Deduction, see instructions 10b 3,173 100 11 0 b Charitable contributions if you take the standard deduction. See instructions c Add lines 10a and 10b. These are your total adjustments to income C 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-O- 12 13 14 0 15 0 Internal Revenue Service (99) Caution: If you are claiming a net qualified disaster loss on Form 4884, see the instructions for line 16 Name(s) shown on Form 1040 or 1040-SR Attachment Sequence No. 07 Your social security number 111-11-1111 Shauna Coleman Medical and Dental Expenses 11,618 Caution: Do not include expenses reimbursed or paid by others. 1 Medical and dental expenses (see instructions) 2 Enter amount from Form 1040 or 1040-SR, line 11 2 3 Multiply line 2 by 7.5% (0.075) 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter - - 5 State and local taxes. 11,618 Taxes You Paid a State and local income taxes or general sales taxes. You may include either income taxes or general sales taxes on line 5a, but not both. If you elect to include general sales taxes instead of income taxes 5a 5b 2,085 3,225 210 5c check this box b State and local real estate taxes (see instructions) c State and local personal property taxes d Add lines 5a through 5c e Enter the smaller of line 5d or $10,000 ($5,000 if married filing separately) 6 Other taxes. List type and amount 5d 5,520 5e 5,520 7 Add lines 5e and 6 7 5,520 Interest You Paid 8 Home mortgage interest and points. If you didn't use all of your home mortgage loan(s) to buy build, or improve your home, see instructions and check this box a Home mortgage interest and points reported to you on Form 1098. See instructions if limited 8a 12,400 Caution: Your mortgage interest deduction may be limited (see instruction) b Home mortgage interest not reported to you on Form 1098. See instructions if limited. If paid to the person from whom you bought the home, see instructions and show that person's name, identifying no., and address 8b 10 12,400 c Points not reported to you on Form 1098. See instructions for special rules 8c d Mortgage insurance premiums (see instructions). 8d e Add lines 8a through 8d. 8e 9 Investment interest. Attach Form 4952 if required. See instructions 9 10 Add lines 8e and 9 11 Gifts to 11 Gifts by cash or check. If you made any gift of $250 or more, see instructions Charity 12 Other than by cash or check. If you made any gift of $250 or more, see instructions. You must attach Form 8283 if over $500 12 Caution: If you made a gift and get a benefit 13 Carryover from prior year 13 for it, see instructions. 14 Add lines 11 through 13 Casualty and 15 Casualty and theft loss(es) from a federally declared disaster (other than net qualified disaster losses). Attach Form 4884 and enter the Theft Losses amount from line 18 of that form. See instructions 1,610 14 1,810 15 16 Otherfrom list in instructions. List type and amount Other Itemized Deductions 16 17 Add the amounts in the far right column for lines 4 through 16. Also, enter this amount on Form 1040 or 1040-SR, line 12 17 31,148 Total Itemized Deductions 18 If you elect to itemize deductions even though they are less than your standard deduction, check this box

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials Of Federal Taxation 2019

Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

10th Edition

1260189988, 1260189678, 9781260189674, 978-1259917103, 125991710X, 978-1260190045

Students also viewed these Accounting questions