Tax return information You own a t-shirt screen printing company called Back the Pack. Back the Pack operates as a regular Corporation under Subchapter C of the Internal Revenue Code. Back the Pack incorporated on April 1, 2014 and business began on June 1, 2014. The company owns the building that the store is located in and all of the equipment that the business uses. The tax year for the Corporation is the calendar year and it is on the accrual method. The tax identification number for Back the Pack is 12-345678. Please complete the 2019 Form 4562 - Depreciation and Amortization. You do not need to complete Parts I, II, V and VI of the form because you should assume you are not electing the Section 179 deduction, you have elected out of bonus depreciation, you have no listed property for the 2019 tax year, and no intangible assets to amortize. You will compute MACRS depreciation in Parts III and IV. You will also need to complete Page 1 of the 2019 Form 1120 - U.S. Corporation Income Tax Return. You will only need to complete through line 30. These forms are found on the IRS website (www.irs.gov). Also, complete the Modified Schedule M-1 Reconciliation of Income (Loss) per Books with Income per Return uploaded on Moodle instead of the Schedule M-l on page 5 of the Form 1120. This is the itemized book- tax differences ("BTD"). Put each BTD separately in the correct section. Note that the depreciation amounts computed on Form 4562 flow to Form 1120 page 1. The Form 1120 page 1 is the tax income statement that includes all tax amounts for income and deductions. The Modified Schedule M-1 starts with net income per books and adjusts the book revenues and expenses to tax amounts using book-tax differences. Line 28 of the Form 1120 should tie to line 8 on the Modified Schedule M-1. Do not worry about including any non- numerical information that is not provided with the assignment The company owns the following assets: Land purchased on 5/1/2014 for $200,000. The land was placed in service on 6/1/2014. Building purchased on 5/1/2014 for $655,000. The building was placed in service on 6/1/2014. Screen printing machinery (Tyr) purchased and placed in service on 6/1/2014 for $280,000 Office furniture and fixtures (Tyr) purchased and placed in service on 1/1/2015 for $55,000 Additional screen printing machinery (Tyr) purchased and placed in service on 2/1/2019 for $235.000 Computer equipment (Syr) purchased and placed in service on 3/1/2019 for $35,000 Warehouse (39yr) purchased and placed in service on 9/1/2019 for S560.000 Back the Pack uses straight line depreciation for book purposes. See the book income statement in the Excel workbook for book depreciation expense for 2019. In additional information for 2019 follows: On November 1, 2019, the Company paid $18,000 premium for a casualty insurance policy for the period 1/1/2020 through 12/31/2020 Specific account write-offs charged to the Allowance for Doubtful Accounts equaled $35,000 Bonuses were paid on March 28, 2020 Debit Credit 1,675,000 435,000 3,500 1 Back the Pack, Inc. 2 Book Income Statement 3 December 31, 2019 4 5 6 Sales 7 Cost of Goods Sold 8 Municipal Bond Interest Income 9 Salaries and Wages (all paid by 12/31/2019) 10 Bonuses 11 Advertising Costs 12 Meals Expense 13 Penalty Expense 14 Bad Debt Expense 15 Depreciation Expense 16 Casualty Insurance Expense 17 18. Totals 19 20 Book Income Before Taxes 21 22 23 475,000 120,000 13,500 5,000 850 22,000 82,500 1,153,850 1,678,500 524,650 OMB No. 1545-0123 20 2019 U.S. Corporation Income Tax Return For calendar year 2019 or tax year beginning 2019, ending Go to www.lrs.gov/Form 1120 for instructions and the latest Information Name Kathryn Smith TYPE OR Number, street, and room or sulte no. If a P.O. bax, see instructions. PRINT City or town, state or province, country, and ZIP or foreign postal code Form Department of the Treasury Internal Revenue Service A Check it TR Consolidated retum attach Form 51 butte con dated 2 Persona hongco nach sch 3 B Employer identification number C Date incorporated Totales (nee instructions) $ Address chan Income AA 4 Schadehed E Check it (9) Initial retum 12 Final return (3) Name change 14 la Gross receipts or sales 1a b Returns and allowances 1b Balance Subtract line 1b from line la 2 Cost of goods sold attach Form 1125-A) Gross profit. Subtract line 2 from line 1c. 4 Dividends and inclusions (Schedule C, line 23) 5 Interest 6 Grossrents 7 Gross royalties 8 Capital gain net income (attach Schedule D (Form 11201) 9 Net gain or loss) from Form 4797, Part II, line 17 (attach Form 4797) 10 Other Income (see instructions-attach statement) 11 Total income. Add lines 3 through 10 12 Compensation of officers (nee instructions-attach Form 1125-E) 13 Salaries and wages oss employment credits) Repairs and maintenance 16 Bad debts 16 Pants 17 Taxes and licenses reste instructions Charitable contributions Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4502) 21 Depletion Advertising Pension, profit-sharing, etc. plans 24 Employee benent programs Reserved for the 26 Omer deductions attach statement) Total deductions. Add lines 12 through 28 20 Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11 29 Niet operating is deductions instructions 29 Special deductions (Schedule , line 24) 20 Add lines 29 and 290 Taxable income, Subtract line 28 from one 28. See instructions 31 Total tax (Schedule J, Part I, 11) 2019 net 965 taxability paid (Schedule J. Partine 12) 33 Total payments, credits, and section 966 tax liability (Schedule Part II, Ine 231 Deduction See Instructions for Motions on deductions) 10 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 8 588 200 30 31 32 33 Part II MACRS Depreciation (Don't include listed property. See instructions.) Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2019 17 18 If you are electing to group any assets placed in service during the tax year into one or more general asset accounts, check here Section 3-Assets Placed in Service During 2019 Tax Year Using the General Depreciation System Money and year Ich Basis for depreciation Caction of property placed in busivement se (d) Recovery le) Convention ( Method period Device tal Depreciation deduction oriy-instruction 19a 3-year property b5-year property c7-year property d 10-year property e 15-year property 1 20-year property 925-year property S/L h Residential rental MM S/L property 275 yrs MM SAL 1 Nonresidential real MM S/L property MM S/L Section C-Assets Placed in Service During 2019 Tax Year Uning the Alternative Depreciation System 200 Classe b 12-year S/L 030-year MM SAL d 40 year 4 Oy MM 5/ Part IV Summary See instructions.) 21 Led property. Enter amount from line 28 21 22 Total Add amounts from line 12, lines 14 through 17. lines 19 and 20 in column (g), and line 21. Enter here and on the appropriate lines of your return. Partnerships and corporations-see instructions 22 23 Forsets shown above and placed in service during the current year, anter the portion of the basis attributable to section 263A costs 23 For Paperwork Reduction Act Notice, separate instructions Car. N100 Form 456210109 25 yr 27.5 yrs 99 S/L 12 ye 90 yrs Tax return information You own a t-shirt screen printing company called Back the Pack. Back the Pack operates as a regular Corporation under Subchapter C of the Internal Revenue Code. Back the Pack incorporated on April 1, 2014 and business began on June 1, 2014. The company owns the building that the store is located in and all of the equipment that the business uses. The tax year for the Corporation is the calendar year and it is on the accrual method. The tax identification number for Back the Pack is 12-345678. Please complete the 2019 Form 4562 - Depreciation and Amortization. You do not need to complete Parts I, II, V and VI of the form because you should assume you are not electing the Section 179 deduction, you have elected out of bonus depreciation, you have no listed property for the 2019 tax year, and no intangible assets to amortize. You will compute MACRS depreciation in Parts III and IV. You will also need to complete Page 1 of the 2019 Form 1120 - U.S. Corporation Income Tax Return. You will only need to complete through line 30. These forms are found on the IRS website (www.irs.gov). Also, complete the Modified Schedule M-1 Reconciliation of Income (Loss) per Books with Income per Return uploaded on Moodle instead of the Schedule M-l on page 5 of the Form 1120. This is the itemized book- tax differences ("BTD"). Put each BTD separately in the correct section. Note that the depreciation amounts computed on Form 4562 flow to Form 1120 page 1. The Form 1120 page 1 is the tax income statement that includes all tax amounts for income and deductions. The Modified Schedule M-1 starts with net income per books and adjusts the book revenues and expenses to tax amounts using book-tax differences. Line 28 of the Form 1120 should tie to line 8 on the Modified Schedule M-1. Do not worry about including any non- numerical information that is not provided with the assignment The company owns the following assets: Land purchased on 5/1/2014 for $200,000. The land was placed in service on 6/1/2014. Building purchased on 5/1/2014 for $655,000. The building was placed in service on 6/1/2014. Screen printing machinery (Tyr) purchased and placed in service on 6/1/2014 for $280,000 Office furniture and fixtures (Tyr) purchased and placed in service on 1/1/2015 for $55,000 Additional screen printing machinery (Tyr) purchased and placed in service on 2/1/2019 for $235.000 Computer equipment (Syr) purchased and placed in service on 3/1/2019 for $35,000 Warehouse (39yr) purchased and placed in service on 9/1/2019 for S560.000 Back the Pack uses straight line depreciation for book purposes. See the book income statement in the Excel workbook for book depreciation expense for 2019. In additional information for 2019 follows: On November 1, 2019, the Company paid $18,000 premium for a casualty insurance policy for the period 1/1/2020 through 12/31/2020 Specific account write-offs charged to the Allowance for Doubtful Accounts equaled $35,000 Bonuses were paid on March 28, 2020 Debit Credit 1,675,000 435,000 3,500 1 Back the Pack, Inc. 2 Book Income Statement 3 December 31, 2019 4 5 6 Sales 7 Cost of Goods Sold 8 Municipal Bond Interest Income 9 Salaries and Wages (all paid by 12/31/2019) 10 Bonuses 11 Advertising Costs 12 Meals Expense 13 Penalty Expense 14 Bad Debt Expense 15 Depreciation Expense 16 Casualty Insurance Expense 17 18. Totals 19 20 Book Income Before Taxes 21 22 23 475,000 120,000 13,500 5,000 850 22,000 82,500 1,153,850 1,678,500 524,650 OMB No. 1545-0123 20 2019 U.S. Corporation Income Tax Return For calendar year 2019 or tax year beginning 2019, ending Go to www.lrs.gov/Form 1120 for instructions and the latest Information Name Kathryn Smith TYPE OR Number, street, and room or sulte no. If a P.O. bax, see instructions. PRINT City or town, state or province, country, and ZIP or foreign postal code Form Department of the Treasury Internal Revenue Service A Check it TR Consolidated retum attach Form 51 butte con dated 2 Persona hongco nach sch 3 B Employer identification number C Date incorporated Totales (nee instructions) $ Address chan Income AA 4 Schadehed E Check it (9) Initial retum 12 Final return (3) Name change 14 la Gross receipts or sales 1a b Returns and allowances 1b Balance Subtract line 1b from line la 2 Cost of goods sold attach Form 1125-A) Gross profit. Subtract line 2 from line 1c. 4 Dividends and inclusions (Schedule C, line 23) 5 Interest 6 Grossrents 7 Gross royalties 8 Capital gain net income (attach Schedule D (Form 11201) 9 Net gain or loss) from Form 4797, Part II, line 17 (attach Form 4797) 10 Other Income (see instructions-attach statement) 11 Total income. Add lines 3 through 10 12 Compensation of officers (nee instructions-attach Form 1125-E) 13 Salaries and wages oss employment credits) Repairs and maintenance 16 Bad debts 16 Pants 17 Taxes and licenses reste instructions Charitable contributions Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4502) 21 Depletion Advertising Pension, profit-sharing, etc. plans 24 Employee benent programs Reserved for the 26 Omer deductions attach statement) Total deductions. Add lines 12 through 28 20 Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11 29 Niet operating is deductions instructions 29 Special deductions (Schedule , line 24) 20 Add lines 29 and 290 Taxable income, Subtract line 28 from one 28. See instructions 31 Total tax (Schedule J, Part I, 11) 2019 net 965 taxability paid (Schedule J. Partine 12) 33 Total payments, credits, and section 966 tax liability (Schedule Part II, Ine 231 Deduction See Instructions for Motions on deductions) 10 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 8 588 200 30 31 32 33 Part II MACRS Depreciation (Don't include listed property. See instructions.) Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2019 17 18 If you are electing to group any assets placed in service during the tax year into one or more general asset accounts, check here Section 3-Assets Placed in Service During 2019 Tax Year Using the General Depreciation System Money and year Ich Basis for depreciation Caction of property placed in busivement se (d) Recovery le) Convention ( Method period Device tal Depreciation deduction oriy-instruction 19a 3-year property b5-year property c7-year property d 10-year property e 15-year property 1 20-year property 925-year property S/L h Residential rental MM S/L property 275 yrs MM SAL 1 Nonresidential real MM S/L property MM S/L Section C-Assets Placed in Service During 2019 Tax Year Uning the Alternative Depreciation System 200 Classe b 12-year S/L 030-year MM SAL d 40 year 4 Oy MM 5/ Part IV Summary See instructions.) 21 Led property. Enter amount from line 28 21 22 Total Add amounts from line 12, lines 14 through 17. lines 19 and 20 in column (g), and line 21. Enter here and on the appropriate lines of your return. Partnerships and corporations-see instructions 22 23 Forsets shown above and placed in service during the current year, anter the portion of the basis attributable to section 263A costs 23 For Paperwork Reduction Act Notice, separate instructions Car. N100 Form 456210109 25 yr 27.5 yrs 99 S/L 12 ye 90 yrs