Tax Return Review Project

Sidney and Allison Durkin

$(2019$ Return$)$

Background: Sidney and Allison Durkin were married on June $27,2009.$ Their daughter, Kellye,

was born on May $3,2011.$ On June $7,2019,$ Allison was killed in a car accident on

Interstate $45.$ Sidney provides financial assistance to his father, Robert, who lives in a

nearby apartment building. Sidney and Allison provided $100\%$ of the cost of

maintaining the home for Kellye and themselves. Everyone is a U$.$S$.$ citizen and has a

Social Security Number.

Sidney K$.$ Durkin$$s personal information is as follows:

$$ Date of Birth $$ January $17,1984$

$$ Social Security number $428-95-5412$

$$ Mobile phone number $615-748-9651$

$$ Address $842$ Lake Woodlands Drive., Magnolia, TX $77345($continuously lived in Texas

since birth$)$

$$ Not blind

$$ Does not want to contribute to the presidential campaign fund

$$ Marketing executive for Woodlands National Bank

Allison O$.$ Durkin$$s personal information is as follows:

$$ Date of Birth $$ May $16,1986$

$$ Social Security number $358-74-1258$

$$ Not blind

$$ Continuously lived in Texas since birth

$$ Fourth grade school teacher at Magnolia Elementary School

$$ Owns Durkin Academic Training Academy, a single$-$member LLC that provides tutoring and

counseling services to children with learning disabilities

Family Information

Kellye F$.$ Durkin$$s personal information is as follows:

$$ Date of Birth $$ May $3,2011$

$$ Social Security number $247-95-6321$

$$ Biological daughter

$$ Lived at home with his parents for the entire year

$$ No income

Robert F$.$ Durkin$$s personal information is as follows:

$$ Date of Birth $$ July $19,1948$ in Madison, WI

$$ Social Security number $728-56-4541$

$$ Sidney$$s father

$$ Single and retired

$$ Robert$$s financial information for $2019$ is as follows:

o Checking account balance on $1/1/2019=$ $$100$

o Social Security benefits received $=$ $$3,000$

o Taxable pension income received $=$ $$12,000$

o Personal assets used for support $=$ $$14,600$

o Checking account balance on $12/31/2019=$ $$500$

o Food expenses $=$ $$2,500$o Clothing expenses $=$ $$240$

o Other non$-$household expenses $=$ $$700$

Financial Information

$$ Sidney and Allison$$s W$-2$s from their employers are attached.

$$ Sidney and Allison have savings invested by England Investments LLC$.$ The related $1099-$

INT is attached. The tax$-$exempt interest was from municipal bonds.

$$ Sidney and Allison have a small stock portfolio that is professionally managed. The related

$1099-$DIV from Crimson Tide Investments LLC is attached.

$$ Revenues and expenses$*$ for Durkin Academic Training Academy $($FEIN $74-5478123)$ are as

follows:

Revenue $ $11,000$

Schedule C Tax Prep $125$

Advertising $225$

Bank service charges $200$

Insurance $($not health$)575$

Office supplies $75$

Wifi $600$

Telephone $500$

Business license $150$

Online software subscriptions $1,000$

$*$ Durkin Academic Training Academy utilizes the cash basis of accounting and began

business on April $14,2007.$

$$ Sidney$$s uncle gave him a $20-$acre parcel of farmland on $2/11/2019.$ His uncle$$s cost basis

was $$10,000,$ and the fair market value on the date of the gift was $$28,500.$ Sidney still owns

the farmland at the end of the year.

$$ Sidney and Allison paid $$2,000$ of sales taxes during the year.

$$ They paid the real estate taxes on the primary residence on December $14,2019.$ A copy of

the receipt is included in the file.

$$ The primary residence is secured by a first mortgage held by Texan National Bank. The entire

amount of the loan was used to purchase the home in $2017.$ The related Form $1098$ is attached.

$$ Sidney and Allison made cash contributions to the First Methodist Church of Magnolia. The

donation letter is included in the tax file.