TAX ACCOUNTING (California):

Required: Complete the questions below for a 1040 for the following taxpayers for 2018. Make assumptions regarding any information not given.

Taxpayer Name: Jack P. JensenSpouse:Jill E. Jensen

Taxpayer DOB:May 17, 1975September 3, 1977

Occupation:Lawn Care SpecialistAdministrative Assistant

Jack and Jill are married and wish to file a joint return. They are not blind or disabled. No one may claim them as dependents. Neither is a student. They are U.S. citizens and they had health insurance the entire year provided by Jack's employer.

Jack and Jill have two Form's W-2. Jill received $230 for serving on a jury. Jill also paid $195 in student loan interest to Sallie Mae. Jack enjoys playing the slots but almost never wins. In the current year, however, he hit a penny jackpot worth $150 at the local Indian casino. (Assume up to $150 of gambling losses)

Jack and Jill have one child, a daughter: Nikki Jensen, DOB: 10/10/2005. Nikki lived with her parents all year long and does not have any income. She is not disabled and is not married. She is a U.S. citizen.

The Jensen's would like to itemize their deductions using the following information:

2017 State Balance Due$261Paid on March 11, 2018

Real Estate Taxes3,325

Doctor and Dentist Fees3,485

Prescription Medications1,200

Glasses425

Medical Mileage 960 miles

Jill's W-2:

Wages:24,291

Fed w/h2,516

Social security1,020

Medicare352

State w/h729

Jack's W-2

Wages:85,000

Fed w/h8,500

Social security5,483

Medicare1,020

State w/h4,200

Jack and Jill have the following stock transactions in 2018:

PepsiPurchased 6/1/08 25,000Sold 7/5/18 32,000

CokePurchased 3/1/18 10,000Sold 10/1/18 7,000

Home DepotPurchased 2/9/18 7,000Sold 9/2/1815,000

Lowe'sPurchased 5/5/15 20,000Sold 3/7/187,000

The Jensen's have the following documents:

1.1099-INT(Interest income) from Bank of America

Box 1$248.39

2.1098- INT(Interest paid) from Wells Fargo

Box 1$4,783.23 for first mortgage

3.1098-INT(Interest paid) from Bank of America

Box 1$2,839.52 for second mortgage

Compute the following:

A.) Total includable gross income:

B.) Adjustments for AGI:

C.) AGI: 108,724.39

D.) Itemized Deductions:

E.) Which should they choose (itemized or standard):

F.) Taxable income:

G.) Tax: 29,957

H.) Credits:

I.) Tax Due/Refund: