Trish Himple owns a retail family clothing store. Her store is located at 4321 Heather Drive, Henderson, NV 89002. Her employer identification number is 95- 1234321 and her Social Security number is 123-45-6789. Trish keeps her books on the cash basis. The income and expenses for the year are:
The truck is not considered a passenger automobile for purposes of the luxury automobile limitations.
Trish also has a qualified home office of 250 sq. ft. Her home is 2,000 sq. ft. Her 2017 purchase price and basis in the home, not including land, is $100,000 (the homes market value is $150,000). She incurred the following costs in 2022 related to the entire home:
Required: For tax purposes, Trish elected out of bonus depreciation in all years except 2022. She did not elect immediate expensing in any year. The tax lives of the assets are the same as the book lives shown in the fixed asset schedule above. Complete Trishs Schedule C, Form 8829, and Form 4562.
- Make realistic assumptions about any missing data.
- Enter all amounts as positive numbers.
- If an amount box does not require an entry or the answer is zero, enter "0".
- If required round any dollar amount to the nearest dollar.
\begin{tabular}{|lr|} \hline Utilities & $3,000 \\ Cleaning & 1,000 \\ Insurance & 1,100 \\ Property taxes & 2,000 \\ \hline \end{tabular} Gross sales Returns and allowances Expenses: \begin{tabular}{lr} Beginning inventory (at cost) & $85,000 \\ Add: purchases & 100,000 \\ \cline { 2 - 2 } Cost of goods available for sale & $185,000 \\ Less: ending inventory (at cost) & 72,000 \\ \hline \end{tabular} $350,000 15,000 Cost of goods sold Rent Insurance Legal and accounting fees Payroll Payroll taxes Utilities Office supplies Advertising $113,000 29,000 3,000 5,000 60,000 5,000 2,200 800 6,000 Form 8829 33 Allowable excess casualty losses and depreciation. Enter the smaller of line 28 or line 32 34 Add lines 14, 27, and 33 35 Casualty loss portion, if any, from lines 14 and 33. Carry amount to Form 4684 See instructions 36 Allowable expenses for business use of your home. Subtract line 35 from line 34 . Enter here and on Schedule C, line 30. If your home was used for more than one business, see instructions . x Part III Depreciation of Your Home 37 Enter the smaller of your home's adjusted basis or its fair market value. See instructions. 38 Value of land included on line 37 39 Basis of building. Subtract line 38 from line 37 40 Business basis of building. Multiply line 39 by line 7 41 Depreciation percentage (see instructions) 42 Depreciation allowable (see instructions). Multiply line 40 by line 41 . Enter here and on line 30 above... Part IV Carryover of Unallowed Expenses to 2023 \begin{tabular}{|lr|} \hline Utilities & $3,000 \\ Cleaning & 1,000 \\ Insurance & 1,100 \\ Property taxes & 2,000 \\ \hline \end{tabular} Gross sales Returns and allowances Expenses: \begin{tabular}{lr} Beginning inventory (at cost) & $85,000 \\ Add: purchases & 100,000 \\ \cline { 2 - 2 } Cost of goods available for sale & $185,000 \\ Less: ending inventory (at cost) & 72,000 \\ \hline \end{tabular} $350,000 15,000 Cost of goods sold Rent Insurance Legal and accounting fees Payroll Payroll taxes Utilities Office supplies Advertising $113,000 29,000 3,000 5,000 60,000 5,000 2,200 800 6,000 Form 8829 33 Allowable excess casualty losses and depreciation. Enter the smaller of line 28 or line 32 34 Add lines 14, 27, and 33 35 Casualty loss portion, if any, from lines 14 and 33. Carry amount to Form 4684 See instructions 36 Allowable expenses for business use of your home. Subtract line 35 from line 34 . Enter here and on Schedule C, line 30. If your home was used for more than one business, see instructions . x Part III Depreciation of Your Home 37 Enter the smaller of your home's adjusted basis or its fair market value. See instructions. 38 Value of land included on line 37 39 Basis of building. Subtract line 38 from line 37 40 Business basis of building. Multiply line 39 by line 7 41 Depreciation percentage (see instructions) 42 Depreciation allowable (see instructions). Multiply line 40 by line 41 . Enter here and on line 30 above... Part IV Carryover of Unallowed Expenses to 2023
