Tax Year 2019: Tax Problem: Marc and Michelle are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. No Forms 1099-INT were issued for the bond interest. Also, Marc paid alimony to a prior spouse in the amount of $1,500. Marc and Michelle have a 10-year-old son, Matthew, who lived with them throughout the entire year. Thus, Marc and Michelle are allowed to claim a $2,000 child tax credit for Matthew. Marc and Michelle will use the standard deduction. They also paid $5,500 in federal income taxes withheld from their paychecks during the course of the year. Everyone was covered by a health insurance plan with Marc's employer. Additional Information: Taxpayers Relationship Social Security US Citizen Yes Husband 123-45-6789 Marc Smith Wife Yes 234-56-7890 Michelle Smith Occupation Address Date of Birth Manager 123 1/1/1983 Pine St, Houston TX 77004 Banker 123 1/1/1990 Pine St, Houston TX 77004 Full-time 123 1/1/2006 student Pine St. Houston TX 77004 Housewife 321 Oak n/a Dr. Houston TX 77005 son Yes Matthew Smith 345-67-8901 Yes 456-78-9012 Mary Jones Ex-wife Date of Divorce 1/1/2010 . Mand Michelle are the only ones Following is a summary of Marc and Michelle's W-2, Wage and Tax Statements Michelle First Bank 100 First Street, Houston, TX 77007 Matthew n/a n/a 74-2345678 $12,000 $1,500 n/a n/a Marc Employer Name Acme Corp Employer Address 123 Acme Dr., Houston, TX 77006 Employer ID # 74-1234567 W-2 Box 1 Wages $64,000 W-2 Box 2 FIT $4,000 withheld W-2 Box 3 SS $64,000 wages W-2 Box 4 SS Tax $ 3,968 W-2 Box 5 $64,000 Medicare wages W-2 Box 6 $ 928 Medicare Tax withheld $12,000 n/a $ 744 $12,000 n/a n/a 174 n/a Use Tax Act to prepare the 2019 Form 1040 for Marc and Michelle Smith. If there is a refund, the Smith's would like a paper check. Also complete the Form 886 Due Diligence. When completing the return, make reasonable assumptions when answering questions if the information is not presented in the facts. Tax Year 2019: Tax Problem: Marc and Michelle are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. No Forms 1099-INT were issued for the bond interest. Also, Marc paid alimony to a prior spouse in the amount of $1,500. Marc and Michelle have a 10-year-old son, Matthew, who lived with them throughout the entire year. Thus, Marc and Michelle are allowed to claim a $2,000 child tax credit for Matthew. Marc and Michelle will use the standard deduction. They also paid $5,500 in federal income taxes withheld from their paychecks during the course of the year. Everyone was covered by a health insurance plan with Marc's employer. Additional Information: Taxpayers Relationship Social Security US Citizen Yes Husband 123-45-6789 Marc Smith Wife Yes 234-56-7890 Michelle Smith Occupation Address Date of Birth Manager 123 1/1/1983 Pine St, Houston TX 77004 Banker 123 1/1/1990 Pine St, Houston TX 77004 Full-time 123 1/1/2006 student Pine St. Houston TX 77004 Housewife 321 Oak n/a Dr. Houston TX 77005 son Yes Matthew Smith 345-67-8901 Yes 456-78-9012 Mary Jones Ex-wife Date of Divorce 1/1/2010 . Mand Michelle are the only ones Following is a summary of Marc and Michelle's W-2, Wage and Tax Statements Michelle First Bank 100 First Street, Houston, TX 77007 Matthew n/a n/a 74-2345678 $12,000 $1,500 n/a n/a Marc Employer Name Acme Corp Employer Address 123 Acme Dr., Houston, TX 77006 Employer ID # 74-1234567 W-2 Box 1 Wages $64,000 W-2 Box 2 FIT $4,000 withheld W-2 Box 3 SS $64,000 wages W-2 Box 4 SS Tax $ 3,968 W-2 Box 5 $64,000 Medicare wages W-2 Box 6 $ 928 Medicare Tax withheld $12,000 n/a $ 744 $12,000 n/a n/a 174 n/a Use Tax Act to prepare the 2019 Form 1040 for Marc and Michelle Smith. If there is a refund, the Smith's would like a paper check. Also complete the Form 886 Due Diligence. When completing the return, make reasonable assumptions when answering questions if the information is not presented in the facts
