Super stuck on a couple of questions on this scenario.

Advanced Scenario 7: Mark and Barbara Matthews Directions Using the tax software, complete the tax retum, including Form 1040 and all appropri- ate forms, schedules, or worksheets. Answer the questions following the scenario. Note: When entering Social Security numbers (SSNS) or Employer identification Numbers (EINS), replace the Xs as directed, or with any four digits of your choice. Interview Notes Mark and Barbara are married and want to file a joint retum. Mark retired and began receiving retirement income on March 1, 2017. No distribu- tions were received prior to his retirement. Mark selected a joint survivor annuity for these payments. The plan cost at annuity start date was $14,500. Mark has already recovered $1,029 of his cost in the plan. The Matthews received a $125 state income tax refund from their 2018 state tax return. The Matthews do not have enough deductions to itemize for 2019 and they have never itemized deductions. Mark and Barbara stated if they are entitled to a refund, they want half of it depos- ited into their checking account and the other half deposited into their savings account. The checking account number is 123456789 and the savings account number is 987654321. Both accounts are from Adelphi Bank and Trust. SOCIAL SECURITY SOCIAL SECURITY www 317-00-XXXX ECE 310-00-XXXX Mark Matthews Barbara Matthews Mark Marthons Bartara Matikeus Department of the Treasury - Intemal Revenue Service Form 13614-C OMB Number Intake/Interview & Quality Review Sheet 1545-1964 (October 2019) Please complete pages 1-4 of this form. You are responsible for the information on your return. Please provide complete and accurate information. If you have questions, please ask the IRS-certified volunteer preparer. You will need: Tax Information such as Forms W-2, 1099, 1098, 1095. Social security cards or ITIN letters for all persons on your tax return. Picture ID (such as valid driver's license) for you and your spouse. Volunteers are trained to provide high quality service and uphold the highest ethical standards. To report unethical behavior to the IRS, email us at wi.voltax@irs.gov Part I- Your Personal Information (If you are filing a joint retum, enter your names in the same order as last year's return) 1. Your first name MARK 2. Your spouse's first name BARBARA 3. Mailing address 742 RED ROOSTER ROAD 4. Your Date of Birth 02/02/1950 Last name MATTHEWS Daytime telephone number Are you a U.S. citizen? YOUR PHONE # M.I. X Yes O No M.I. Last name Daytime telephone number Is your spouse a U.S. citizen? X Yes MATTHEWS O No ZIP code YOUR ZIP Apt # City State YS YOUR CITY 5. Your job title RETIRED 6. Last year, were you: a. Full-time student Yes X No O Yes X No O Yes X No O Yes X No O Yes X No c. Legally blind a. Full-time student c. Legally blind b. Totally and permanently disabled 9. Last year, was your spouse: 7. Your spouse's Date of Birth 8. Your spouse's job title ADMIN ASST O Yes X No 04/03/1957 b. Totally and permanently disabled O Yes X No O Unsure 10. Can anyone claim you or your spouse as a dependent? O Yes X No 11. Have you, your spouse, or dependents been a victim of tax related identity theft or been issued an Identity Protection PIN? Part II - Marital Status and Household Information O Never Married X Married 1. As of December 31, 2019, what was your marital status? (This includes registered domestic partnerships, civil unions, or other formal relationships under state law) a. If Yes, Did you get married in 2019? b. Did you live with your spouse during any part of the last six months of 2019? X Yes O No Date of final decree O Yes X No O Divorced O Legally Separated O Widowed Date of separate maintenance decree Year of spouse's death 2. List the names below of: everyone who lived with you last year (other than your spouse) anyone you supported but did not live with you last year If additional space is needed check here O and list on page 3 To be completed by a Certified Volunteer Preparer Relationship Number of US to you (for months |eample: son, daughter, parent, none, etc) (c) Full-time Totally and Is this Married as Student Permanently person a Did the taxpayer(s) taxpayer(s) provide more pay more than Name (first, last) Do not enter your name or spouse's name below Resident Single or Did this person qualifying provide Date of Birth Did this person have less child/relative more than than $4 200 than 50% of half the cost of of any other 50% of his/ of income? support for maintaining a (yesho) Did the Citizen of US, (yeso) Canada, of 12/31/19 last year Disabled (mm/dd/yy) lived in your home last year or Mexico (S/M) last year (yesno) (yeso) (yeso) this person? (yeso/N/A) person? (yeso) her own support? (yeso) home for this person? (yeso) (a) (b) (d) (e) (f) (9) (h) (0) Form 13614-C (Rev. 10-2019) Catalog Number 52121E www.irs.gov O0O Page 2 Check appropriate box for each question in each section No Unsure Part III- Income - Last Year, Did You (or Your Spouse) Receive Yes 1. (B) Wages or Salary? (Form W-2) 2. (A) Tip Income? If yes, how many jobs did you have last year? 3. (B) Scholarships? (Forms W-2, 1098-T) 4. (B) Interest/Dividends from: checking/savings accounts, bonds, CDs, brokerage? (Forms 1099-INT, 1099-DIV) 5. (B) Refund of state/local income taxes? (Form 1099-G) 6. (B) Alimony income or separate maintenance payments? 7. (A) Self-Employment income? (Form 1099-MISC, cash) 8. (A) Cash/check payments for any work performed not reported on Forms W-2 or 1099? 9. (A) Income (or loss) from the sale of Stocks, Bonds or Real Estate? (including your home) (Forms 1099-S,1099-B) 10. (B) Disability income? (such as payments from insurance, or workers compensation) (Forms 1099-R, W-2) 11. (A) Retirement income or payments from Pensions. Annuities, and or IRA? (Form 1099-R) 12. (B) Unemployment Compensation? (Form 1099G) 13. (B) Social Security or Railroad Retirement Benefits? (Forms SSA-1099, RRB-1099) 14. (M) Income (or loss) from Rental Property? 15. (B) Other income? (gambling, lottery, prizes, awards, jury duty, Sch K-1, royalties, foreign income, etc.) Specify Yes No Unsure Part IV - Expenses - Last Year, Did You (or Your Spouse) Pay O No O Yes O Roth IRA (B) 1. (B) Alimony or separate maintenance payments? 2. Contributions to a retirement account? If yes, do you have the recipient's SSN? O IRA (A) O 401K (B) O Other 3. (B) College or post secondary educational expenses for yourself, spouse or dependents? (Form 1098-T) O Medical & Dental (including insurance premiums) O Taxes (State, Real Estate, Personal Property, Sales) O Mortgage Interest (Form 1098) O Charitable Contributions 4. (A) Any of the following? 5. (B) Child or dependent care expenses such as daycare? 6. (B) For supplies used as an eligible educator such as a teacher, teacher's aide, counselor, etc.? 7. (A) Expenses related to self-employment income or any other income you received? 8. (B) Student loan interest? (Form 1098-E) Yes No Unsure Part V- Life Events - Last Year, Did You (or Your Spouse) 1. (HSA) Have a Health Savings Account? (Forms 5498-SA, 1099-SA, W-2 with code W in box 12) 2. (A) Have credit card or mortgage debt cancelled/forgiven by a lender or have a home foreclosure? (Forms 1099-C, 1099-A) 3. (A) Adopt a child? 4. (B) Have Earned Income Credit, Child Tax Credit or American Opportunity Credit disallowed in a prior year? If yes, for which tax year? 5. (A) Purchase and install energy-efficient home items? (such as windows, furnace, insulation, etc.) 6. (A) Receive the First Time Homebuyers Credit in 2008? 7. (B) Make estimated tax payments or apply last year's refund to this year's tax? 8. (A) File a federal return last year containing a "capital loss carryover" on Form 1040 Schedule D? 9. (A) Have health coverage through the Marketplace (Exchange)? [Provide Form 1095-A] If so how much? Form 13614-C (Rev. 10-2019) Catalog Number 52121E www.irs.gov D000 D 00020OI Page 3 Additional Information and Questions Related to the Preparation of Your Return 1. Provide an email address (optional) (this email address will not be used for contacts from the Internal Revenue Service) 2. Presidential Election Campaign Fund (If you check a box, your tax or refund will not change) X Spouse X You Check here if you, or your spouse if filing jointly, want $3 to go to this fund c. To split your refund between different accounts Yes X No a. Direct deposit X Yes 3. If you are due a refund, would you like: b. To purchase U.S. Savings Bonds X No O Yes O No O Yes O No 4. If you have a balance due, would you like to make a payment directly from your bank account? O Yes 6. Did you, or your spouse if filing jointly, receive a letter from the IRS? X No O Yes 5. Live in an area that was declared a Federal disaster area? If yes, where? X No Many free tax preparation sites operate by receiving grant money or other federal financial assistance. The data from the following questions may this site to apply for these grants or to support continued receipt of financial funding. Your answer will be used only for statistical purposes. These questions are optional. used by 7. Would you say you can carry on a conversation in English, both understanding & speaking? X Very well O Well 8. Would you say you can read a newspaper or book in English? 9. Do you or any member of your household have a disability? 10. Are you or your spouse a Veteran from the U.S. Armed Forces? O Not well O Not at all O Prefer not to answer O Not at all X Very well O Yes O Yes O Well No X No O Not well O Prefer not to answer O Prefer not to answer O Prefer not to answer 11. Your race? O American Indian or Alaska Native O Asian O Native Hawaiian or other Pacific Islander O White X Prefer not to answer O Black or African American 12. Your spouse's race? O American Indian or Alaska Native O Black or African American O Asian O Hispanic or Latino O Hispanic or Latino O White X Prefer not to answer O Native Hawaiian or other Pacific Islander X Prefer not to answ O Not Hispanic or Latino O Not Hispanic or Latino 13. Your ethnicity? er 14. Your spouse's ethnicity? X Prefer not to answer Additional comments Privacy Act and Paperwork Reduction Act Notice The Privacy Act of 1974 requires that when we ask for information we tell you our legal right to ask for the information, why we are asking for it, and how it will be used. We must also tell you what could happen if we do not receive it, and whether your response is voluntary, required to obtain a benefit, or mandatory. Our legal right to ask for information is 5 US.C. 301. We are asking for this information to assist us in contacting you relative to your interest and/or participation in the IRS volunteer income tax preparation and outreach programs. The information you provide may be furnished to others who coordinate activities and staffing at volunteer return preparation sites or outreach activities. The information may also be used to establish effective controls, send correspondence and recognize volunteers. Your response is voluntary. However, if you do not provide the requested information, the IRS may not be able to use your assistance in these programs. The Paperwork Reduction Act requires that the IRS display an OMB control number on all public information requests. The OMB Control Number for this study is 1545-1964. Also, if you have any comments regarding the time estimates associated with this study or suggestion on making this process simpler, please write to the Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP T:T:SP, 1111 Constitution Ave. Nw, Washington, DC 20224 Form 13614-C (Rev. 10-2019) Catalog Number 52121E www.irs.gov Sete, accurate, FASTI Use a Employee's soaal secunty numoar 310-00-XXXX Vint the IRS webate at www.vo.gowedlo e+ file OMB Na. 1545-0008 b Employer icenlcation number EN I Wage, sp other comperion 28.500.00 3 Socl curity wages 2 Federal income tax withhuld 40-000XXXX 2,784.00 4 Social security tax wed 1,767.00 O Medicare ta withhed 413.25 e Ermployer's name, adcress, and ZP code 28,500.00 CONWAY COMPANY 5 Medicore wages and ips 25 IMPERIAL LANE YOUR CITY, STATE ZIP 28,500.00 7 Social security tips 8 Alocated tps d Control number 10 Dapandent care banelta e Employee's first name and nhal But. 11 Noncusifed plara 12n See instrueiona for box 12 Last name BARBARA MATTHEWS 742 RED ROOSTER YOUR CITY, STATE ZIP 12b 14 Oha 120 12d f Employee's addres and ZP code 15 Stute Employer's state ID number YS | 34-500XXXX 18 Local wages, Sps, ete. 10 Local inoome tax 20 Locality sone 16 State wages, tips, ete. 17 State income tax 28,500.00 1,400.00 2019 Department of the Trestury-Internal Reverue Service W-2 Wage and Tax Statement Form Copy B-To Be Filed With Employee's FEDERAL Tax Return. This information is being furnished to the Intemal Aevenue Service. CORRECTED (f checked) 1 Gross distribution OMB No. 1545-0119 Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. PAYER'S name, street address, city or town, state or province, country, ZIP or fareign postal code, and phone no. 22,532.00 2a Taxable amount 2019 PINE CORPORATION 1809 GULF DRIVE YOUR CITY, STATE ZIP Farm 1099-R 2 b amount not determined x Total Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in distribution 3 Capital gain included in bax 2a) PAYER'S TIN RECIPIENT'S TIN 4 Federal irncome tax withheld 2,253.00 40-100XXXX 317-00-XXXX 5 Empioyee contributiona 6 Net unrealized RECIPIENT'S name Designated Roth contributions or appreciation h employer's securities box 4, attach this copy to your return. MARK MATTHEWS insurance pramiume 7 Distribution codejs) 8 Other Street address (ncluding apt. no.) IRA SEP SIMPLE This information is 742 RED ROOSTER being fumished to the IRS % City or town, state or provinoe, country, and ZIP or foreign postal code da YOUR CITY, STATE ZIP 9b 14,500.00 13 State/Payer's state no. 14 State distribution Total employee contributore Your percentage of total distribution 10 within 5 years 11 1st year of desig. Roth contrib 12 FATCA ing requrement State tax withheld Amount allocable to IAR 15 17 Local distribution Date of payment 16 Name of locality Account number see instructions) Local tax withheld Fom 1099-R Department of the TreasuryIntemal Revernue Bervice www.rs.gowForm109SA CORRECTED (if checked) 1 Gross distribution OMB No. 1545-0118 Distributions From PAYER'S name, street address, cty or town, state or province, country, ZIP or foreign postal code, and phone no. Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. 3,200.00 2a Taxable amount 2019 ESSEX BANK, CUSTODIAN FOR ROTH IRA OF MARK MATTHEWS 300 MARIN STREET Fom 1099-R 0.00 YOUR CITY, STATE ZIP Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in 26 Taxable amount Total not determined distribution RECIPIENT'S TIN 3 Capital gain (included in box 2n PAYER'S TIN 4 Federal income tax withheld 48-100XXXX RECIPIENT'S name 317-00-XXXX 5 Employee contributions 6 Net urrealized Designated Roth contributions or insurance premin appreoiation in employer's securities box 4, attach this copy to your return. MARK MATTHEWS IS 8 Other Street address (inoluding apt. no 7 Distributicn code(s) IRA SEP/ SIMPLE This information is being fumished to the IRS. 742 RED ROOSTER City or town. state or province, country, and ZIPor foreign postal code 8a YOUR CITY, STATE ZIP 10 Amount allocatie to IRR within 5 years Your percentage of total 9b Tetal employee cmibutions distribution 11 1st vear of FATCA ing 12 State tau wttheld 13 State/Payer's stale no 14 State distribution reuement desig. Rth contrb 17 Local distribution 16 Name of locality Date of payment Account number see inatructione) 15 Local tax withheid Fom 1099-R www.irs govFom100DR Degartmert of the Trery-temal Ruvur Servke FORM SSA-1099 - SOCIAL SECURITY BENEFIT STATEMENT PART OF YOUR SOCIAL SECUEITY BENEFITS SHOWN IN BOX 5 MAY BE TAXABLE INCOME 2019 .E THE REVERSE FOR MORE INFORMATION. Box 2. Baneficiary's Socia Sacurty Number 317-00-XXXX Box 1. Nama MARK MATTHEWS Box 3. Benefta Paid in 2019 $17,214.00 Box 4. Benetts Repaid to SSA in 2019 Bax 5. Net Berwits for 2010 Bax 3 ias Bar 4) $17,214.00 DESCRIPTION OF AMOUNT IN BOx 3 DESCRIPTION OF AMOUNT IN BOx 4 Paid by check or direct deposit: $13,867.00 Medicare Part B premiums deducted from your benefits: $1,626.00 Box 6. Vduntary Faderal Income Tax Wthhoiding Total Additions: $1,721.00 Benefits for 2019: Box 7. Aocress 14 742 Red Rooster Your City, State ZIP hox teryou neee o cor A Clim Number ne Draft as of June 21, 2019 - Subject to Change Ferm 88A-1-SM 01 DO NOT RETURN THIS FORM TO SSA OR IRS ABC INVESTMENTS 2019 TAX REPORTING STATEMENT Mark and Barbara Matthews 456 Pima Plaza Your City, YS ZIP 742 Red Rooster Road Your City, YS ZIP Account No. 111-222 Recipient ID No. 317-00-XXXX Payer's Fed ID Number: 40-200XXXX Form 1099-DIV* 2019 Dividends and Distributions Copy B for Recipient (OMB NO. 1545-0110) 220.00 laTotal Ordinary Dividends 1b Qualified Dividends.. .189.00 308.00 2a Total Capital Gain Distributions (Includes 2b- 2d). 2b Capital Gains that represent Unrecaptured 1250 Gain. 20 Capital Gains that represent Section 1202 Gain. 2d Capital Gains that represent Collectibles (28%) Gain. .0.00 .0.00 .0.00 3 Nondividend Distributions. 50.00 0.00 4 Federal Income Tax Withheld 5 Section 199A Dividends 6 Investment Expenses 7 Foreign Tax Paid... 8 Foreign Country or U.S. Possession. . 9 Cash Liquidation Distributions 10 Non-Cash Liquidation Distributions. 11 Exempt Interest Dividends 12 Specified Private Activity Bond Interest Dividends 13 State .0.00 .0.00 18.00 ..0.00 .0.00 .0.00 .0.00 .0.00 14 State Identification No. .0.00 15 State Tax Withheld Form 1099-MISC* 2019 Miscellaneous Income Copy B for Recipient (OMB NO. 1545-0115) 2 Royalties.. .0.00 4 Federal Income Tax Withheld .0.00 8 Substitute Payments in Lieu of Dividends or Interest .0.00 16 State Tax Withheld .0.00 State/ Payer's State No. 17 18 State Income. .0.00 Form 1099-INT 2019 Interest Income Copy B for Recipient (OMB NO. 1545-0112) 1 Interest Income 2 Early Withdrawal Penalty 3 Interest on U.S. Savings Bonds and Treas. Obligations. .0.00 .0.00 .0.00 .0.00 4 Federal Income Tax Withheld 5 Investment Expenses 6 Foreign Tax Paid.. 7 Foreign Country or U.S. Possession. 8 Tax-Exempt Interest 9 Specified Private Activity Bond Interest 14 Tax-Exempt Bond CUSIP No.. .0.00 .0.00 0.00 0.00 Summary of 2019 Proceeds From Broker and Barter Exchange Transactions Sales Price of Stocks, Bonds, etc.. Federal Income Tax Withheld 6,300.00 .0.00 Gross Proceeds from each of your security transactions are reported individually to the IRS. Refer to the Form 1090-8 section of this statement Report gross proceeds individually for each security on the appropriate IRS tax retun. Do not report gross proceeds in aggregate. Page 1 of 2 ABC INVESTMENTS 2019 TAX REPORTING STATEMENT 456 Pima Plaza Mark and Barbara Matthews Your City, YS ZIP 742 Red Rooster Road Your City, YS ZIP Account No. 111-222 Recipient ID No. 317-00-XXXX Payer's Fed ID Number: 40-200XXxx FORM 1099-B* 2019 Proceeds from Broker and Barter Exchange Transactions Copy B for Recipient OMB NO. 1545-0715 Short-term transactions for which basis is reported to the IRS Report on Fom 8949 with Box A checked and/or Schedule D, Part I (This Label is a Substitute for Boxes 1c & 6) 8 Description, 1d Stock or Other Symbol, CUSIP (IRS Form 1099-B box numbers are shown below in bold type) 1c Date sold 1a Quantity Sold 1d Proceeds 1e Cost or Other Basis Action 1b Date Gain / Loss (-) 1g Wash Sale Loss Disallowed 4 Federal Income Tax Withheld 14 State 15 State Tax Withheld Acquired disposed Idaho Co. Common Stock (489.00) Sale 02/01/2019 10v01/2019 250.000 1,700.00 2,189.00 TOTALS 2,189.00 1,700.00 FORM 1099-B* 2019 Proceeds from Broker and Barter Exchange Transactions Copy B for Recipient OMB NO. 1545-0715 Long-term transactions for which basis is not reported to the IRS Report on Fom 8949 with Box E checked and/or Schedule D, Part II (This Label is a Substitute for Boxes 1c & 6) 8 Description, 1d Stock or Other Symbol, CUSIP 1c Date sold disposed (IRS Form 1099-B box numbers are shown below in bold type) Action 16 Date Acquired 1d Proceeds 1g Wash Sale Loss Disallowed 1e Cost or Other Basis Gain / Loss (-) 15 State Tax Withheld 1a Quantity Sold 4 Federal Income Tax Withheld 14 State lowa Co. Common Stock 2,900.00 Sale 08/15/1999 03/01/2019 200.000 4,600.00 1,700.00 TOTALS 1,700.00 4,600.00 This is important tax information and is being fumished to the Intemal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Page 2 of 2 CORRECTED (if checked) PAYER'S name, street address, city or town, state or province, country, ZIP or forcign postal code, and telephone no. OMB No. 1545-0112 Payer's RTN (optional) Interest Adelphi Bank and Trust 8020 Yonkers Blvd 2019 1 Interest income Income YOUR CITY, STATE ZIP $ 300.00 2 Early withdrawal penalty Form 1099-INT Copy B RECIPIENT'S TIN PAYER'S TIN For Recipient 3 Interest on U.S. Savings Bonds and Treas, obligations 34-7XXXXXX 317-00-XXXX %24 This is important tax information and is being furnished to the IRS. If you are required to file a return, a negligence penalty or other sanction may be Imposed on you if thia income is RECIPIENT'S name 4 Federal income tax withheld 5 Investment expenses $ 20.00 6 Foreign tax paid MARK MATTHEWS 7 Foreign country or U.S. possession Street address (including apt. no.) - rterest 9 Speolled priete actity bond interest 742 RED ROOSTER City or town, state or province, country, and ZIP or toreign postal code I2$ 10 Market discount 11 Bond premium YOUR CITY, STATE ZIP taxable and the IRS determines that it has not been reported. 50.00 FATCA filing S requirement 12 Bond premium on Treasury obigaions 13 Bond premrium on tax-exempt bond 14 Tax-exemat and tax credit bond CUSIP no. 16 State 16 State identification no. 17 State tax withheld Account number (see instructions) Form 1099-INT (keep for your records) www.irs.gov/Form1099INT Denartment ot the Treasury - Intenal Ravenue Service 1234 Mark and Barbara Matthews 742 Red Rooster Road Your City, State 00000 20 PAY TO THE ORDER OF DOLLARS Adelphi Bank and Trust Anytown, State 00000 For :111000025 : 123456789 1234 22. The correct amount of taxable interest on Form 1040 is $300. True False 24. What is the taxable portion of Mark's pension from Pine Corporation using the simplified method? A. $561 B. $14,500 OC. $21,971 D. $22,532