The Howells received a Form 1099-B from the Vanguard mutual fund reporting a $900 long-term capital gain distribution. This distribution was reinvested in 31 additional Vanguard mutual fund shares on 6/30/2021.

In 2014, Mrs. Howell loaned $6,100 to a friend who was starting a new multilevel marketing company called LD3. The friend declared bankruptcy in 2021, and Mrs. Howell has been notified she will not be receiving any repayment of the loan.

The Howells have a $2,400 short-term capital loss carryover and a $4,900 long-term capital loss carryover from prior years.

The Howells did not instruct their broker to sell any particular lot of IBM stock.

The Howells earned $3,050 in municipal bond interest, $3,050 in interest from corporate bonds, and $4,100 in qualified dividends.

Assume the Howells have $132,500 of wage income during the year.

Compute the Howells tax liability for the year (ignoring the alternative minimum tax and any phase-out provisions) assuming they file a joint return, they have no dependents, they dont make any special tax elections, and their itemized deductions total $26,000.

1a Iotals tor all short-term transactions reported on torm 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949 , leave this line blank and go to line 1b 1b Totals for all transactions reported on Form(s) 8949 with Box A checked 2 Totals for all transactions reported on Form(s) 8949 with Box B checked 3 Totals for all transactions reported on Form(s) 8949 with Box C checked 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 5 Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 6 Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions 7 Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back \begin{tabular}{|r|r|} \hline 4 & \\ \hline 5 & \\ \hline 6 & (2,400) \\ \hline & \\ \hline 7 & (8,400) \\ \hline \end{tabular} 1a Iotals tor all short-term transactions reported on torm 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949 , leave this line blank and go to line 1b 1b Totals for all transactions reported on Form(s) 8949 with Box A checked 2 Totals for all transactions reported on Form(s) 8949 with Box B checked 3 Totals for all transactions reported on Form(s) 8949 with Box C checked 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 5 Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 6 Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions 7 Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back \begin{tabular}{|r|r|} \hline 4 & \\ \hline 5 & \\ \hline 6 & (2,400) \\ \hline & \\ \hline 7 & (8,400) \\ \hline \end{tabular}