The following information pertains to Ken (age 70) and Kami (age 53) Kane, who are married and have 12-year-old twin daughters, Krista and Kellie. The Kanes have asked you to prepare their Form 1040 and Schedule 1. Income Kami's salary $290,000 Interest income on: Corporate bond 8,000 Municipal bond 6,200 Lottery winnings 15,000 Inheritance received due to death of Kami's father 150,000 Life insurance proceeds received due to death of Kami's father 50,000 Compensatory lawsuit proceeds related to Kens physical injury 20,000 Punitive lawsuit proceeds related to Kens physical injury 10,000 Gain on sale of primary residence (purchased in 2016 and both have lived there since 260,000 Kens annuity receipts (He invested $134,400 in the annuity in a prior year and received $1,000 per month related to the annuity this year.) 12,000 Other Information Expenditures that qualified as itemized deductions 24,200 Child tax credit 4,000 Federal income taxes withheld from Kamis paycheck 60,400