Tax Software Assignment Fall 2023

Ms. Jeanette Letourneau (SIN 123-456-789) was born in Montreal on December 15, 1979. She has spent most of her working life a song writer but also has a part-time job as a business manager. Jeanette and her family lives at 1370 Barrydowne Road, Sudbury, ON, postal code P3E 5K3, phone (604) 555-5555. They also have a cabin on Lake Superior which they frequent on the weekends and most of the summer. She is not registered for CRA online mail and does not wish to have an electronic notice of assessment.

She is a Canadian citizen and would like to provide her information to elections Canada. She informs you that she has not owned or sold any foreign property during the year.

Ms. Letourneaus spouse, Sean (SIN 527-000-129), was born on June 20, 1978. He and Ms. Letourneau have two children. Penny was born on June 16, 2020, and Lewis was born on July 16, 2021. Sean is self-employed and earned $120,000 from a seasonal landscaping company that he owns.

Other information concerning Ms. Letourneau and her family for 2023 is as follows:

1. Ms. Letourneau earned $73,000 for work as the manager of Totally Chic Clothing Co. Her T4 showed that her employer withheld $6,800 for income taxes, $3,754.45 for CPP and $1,002.45 for EI.

1. Several of Ms. Letourneau s songs, have provided her with substantial royalty payments over the years. In 2023, her revenue was $12,000 in royalty payments. This was reported in box 17 on a T5 received from MusicCan.

1. Ms. Letourneau earned $13,000 from songs sold during the year. She does not collect GST on this income. On January 1, 2023, she began leasing a small, quiet studio for $1,200 a month. The space is used solely for her composing and song writing business (Letourneau Music, BN 77777 7777 RT001). Her expenses include $2,600 to attend a songwriters convention in Nashville, office supplies of $800, and a membership to the Song Writers of Canada Association for $630. (T2125)

1. She purchased a Roland electric piano on January 15th for $15,350 that was delivered to her studio space. [Note: On the T2125 CCA asset details check No under questions asking if the asset qualifies as a designated immediate expensing property as this topic was omitted from TAXX3402 this will incur a red flag ignore it].

1. At the beginning of 2019, Ms. Letourneau had a net-capital loss carry forward of $13,000 from the sale of shares in 2018. She had not disposed of any capital asset prior to 2018. Below are some of the assets she disposed of in 2023. Alpha Co. shares and Beta shares are both publicly traded companies. (Schedule 3)

Asset Dispositions	Asset 1	Asset 2	Asset 3	Asset 4
Description	Alpha shares	Beta shares	Jet ski	Coin collection
Number of units	500	250	N/A	N/A
Year of acquisition	2015	2016	2017	2018
Date of disposition	Feb 8	March 14	April 25	May 31
Proceeds of disposition	15,000	9,300	7,000	12,000
ACB	7,000	8,600	500	2,300
Outlays and expenses	100	50	N/A	N/A

1. Ms. Letourneau provides you with the following receipts for child related expenses.

Child	Child related expenses (Organization or Name and SIN)	No. of Weeks	Amount
Penny	Kids R Us Daycare	52	5,700
Lewis	Kids R Us Daycare	52	6,300
Penny	Camp Mozart (see note)	1	200
Lewis	Baby Jams music camp (see note)	1	200

Note: Neither camp is sleep-away, fees listed represent child-care portion, only.

1. On November 1, Jeanette decided to cancel the lease for her business space. She incurred $3,000 in lease cancellation costs as a result. There was 14 months left on the lease.

1. Ms. Letourneau made contributions to the Federal Liberal Party in the amount of $800 during the year.

1. During the year, Ms. Letourneau made her annual $2,200 donation to the Sudbury Youth Emergency Shelter Society (YESS), a registered Canadian charity. (Schedule 9)

1. Ms. Letourneau wishes to claim all her medical expenses on a calendar year basis. On December 2, 2023, Ms. Letourneau paid dental expenses to Delta Dental Clinics for the following individuals:

Ms. Letourneau	$3,000
Sean	500
Penny	300
Lewis	300

1. Ms. Letourneau made a $5,000 contribution to her TFSA during the year and on November 15, made a contribution of $7,000 to her RSP and $7,000 to Seans RSP, both with TD Waterhouse. According to her 2022 NOA, she has $32,000 in RSP room and her EA was $89,000. (Schedule 7)

1. On March 15, June 15, Sept 15 and Dec 15, Ms. Letourneau paid instalments of $500 as requested by CRA.

Required: Students will form into a group of 4 and prepare Ms. Letourneaus 2023 income tax return using the ProFile tax software program. You may assume that Sean will prepare his return separately.

Additional items for you to consider:

• To complete this return, you must use Profile Tax software. There are separate download instructions for PC and Apple users on Moodle. Failure to use the appropriate software will result in zero.
• While youre working, remember to save your progress. The best location for this will be your desktop (this is true for both PC and Apple Users).
• You must submit the Profile file (not a PDF).
• Please review the provided instructions on how to get started with the case before you begin. Ive set up a video in Moodle for this.
• The Industry code for Ms. Letourneaus sole proprietorship is 711130.
• She does not live outside of the Climate Action Incentive Program.
• She was not associate with one or more EPOPs during the fiscal period.
• She would like to share her information with Ontario Health for the purposes of organ donation.
• You may find it beneficial to review the sample personal tax return in Moodle. This return is different but could give you some hints on how to fill out certain sections in Profile. You can find the question in Tax Software AP 11-1 in your textbook. I have uploaded the profile solution and the forms solution on Moodle.
• You may find it beneficial to complete the calculations before you use Profile. Youll need to include an extra deduction under Other Deductions for Enhanced CPP $631. It functions like this: Jeanette paid $3,754.45 in CPP. Of this amount, shell receive $3,123 as a credit and the remaining $631 is a deduction under Other Deductions. This second component was accidentally omitted from our class (sorry, its a newer deduction that I wasnt aware of). It will be automatically calculated for you in Profile.

Upon successful completion of this T1 you should have the following schedules:

• T1 and
• Schedule 3, 7, 9, T778, and T2125 (some of these schedules will self-generate from other forms such as the Information and the Dependant information, various T-slips, and receipts you have entered). You will also have many other secondary documents that will also populate such as T936 CNIL, CAIP, CCB, T2204 Overpayment of EI, T5000 Overpayment of CPP. These will not affect your calculation.
• Your T1 should show the following:
  • Net Income for Tax Purposes $62,030.00
  • Taxable Income $49,905.00
  • Final refund $3,831.95