THE BOXES OUTLINED IN BLUE MUST BE COMPLETED

Ken is 63 years old and unmarried. He retired at age 55 when he sold his business, Understock.com. Though Ken is retired, he is still very active. Ken reported the following financial information this year. Assume Ken files as a single taxpayer. a. Ken won $1,200 in an illegal game of poker (the game was played in Utah, where gambling is illegal). b. Ken sold 1,000 shares of stock for $32 a share. He inherited the stock two years ago. His tax basis (or investment) in the stock was $31 per share. c. Ken received $25,000 from an annuity he purchased eight years ago. He purchased the annuity, to be paid annually for 20 years, for $210,000. d. Ken received $13,000 in disability benefits for the year. He purchased the disability insurance policy last year. e. Ken decided to go back to school to learn about European history. He received a $500 cash scholarship to attend. He used $300 to pay for his books and tuition, and he applied the rest toward his new car payment. f. Ken's son, Mike, instructed his employer to make half of his final paycheck of the year payable to Ken as a gift from Mike to Ken. Ken received the check on December 30 in the amount of $1,100. g. Ken received a $610 refund of the $3,600 in state income taxes his employer withheld from his pay last year. Ken claimed $12,600 in itemized deductions last year (the standard deduction for a single filer was $12,550 ). h. Ken received $30,000 of interest from corporate bonds and money market accounts. Required information Form 1040 Schedule 1. SCHEDULE 1 (Form 1040) Department of the Treasury Internal Revenue Service Additional Income and Adjustments to Income Attach to Form 1040, 1040-SR, or 1040-NR. Go to www.irs.gov/Form 1040 for instructions and the latest information. OMB No. 15450074 2021 Attachment Sequence No. 01 Name(s) shown on Form 1040, 1040-SR, ar 1040-NR Your social security number Part I Additional Income 1 2a b 3 4 5 b 7 8 a b C d e p g h I k I m Section 951(a) inclusian (see instructions) n Section 951A(a) inclusion (see instructions) . 0 Section 461 (I) excess business lass adjustment p Tacable distributions from an ABLE account (see 2 9 10 Taxable refunds, credits, or pffsets of state and local income taxes Aimorty rectived Date of origiral divorce or separation agreement (see instructions) Qusiness income or (lass). Attach Schedule C Other gains or (losses). Attach Form 4797 Rental resal estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E Farm income or (lass). Attach Schedule F Unemployment compensation Other incarne: Net pperating lass Gambling Income Cancellation of debt Foreign earned incarne exolusion fram Farm 2555 Tarable Health Savings Acoount distribution Aaska Permanent Fund dividends Jury duty pary Prizes and awards Activity not engaged in for profit incorne Stack aptions Income from the rental af personal property if you engaged in the rental for profit but were not in the business of renting such property Olympic and Paralympic medals and USOC prize money (see irstructions? instructions) Other incorne. List type and armount Total ather income. Add lines 8a through 8z Combine lines 1 through 7 and 9 . Enter here and an Form 1040, 1040-SR, or 1040-NR, line B \begin{tabular}{|c|c|} \hline 1 & \\ \hline 2a & \\ \hline & \\ \hline 3 & \\ \hline 4 & \\ \hline 5 & \\ \hline 6 & \\ \hline 7 & \\ \hline 10 & \\ \hline & \\ \hline \end{tabular}