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Comprehensive Problem 7-1

David and Darlene Jasper have one child, Sam, who is 6 years old (birthdate July 1, 2012). The Jaspers reside at 4639 Honeysuckle Lane, Los Angeles, CA 90248. David's Social Security number is 577-11-3311, Darlene's is 477-98-4731, and Sam's is 589-22-1142. David's birthdate is May 29, 1985 and Darlene's birthday is January 31, 1987. David and Darlene's earnings and withholdings for 2018 are:

David:	Earnings from Apple Company (office manager)	$26,500
	Federal income tax withheld	2,800
	State income tax withheld	1,050
Darlene:	Earnings from Rose Company (perfume tester)	$25,200
	Federal income tax withheld	2,650
	State income tax withheld	1,000

Their other income includes interest from Pine Tree Savings and Loan of $1,900. Other information and expenditures for 2018 are as follows:

Interest:	On home acquisition mortgage	$11,200
	Credit card	925
Taxes:	Property taxes on personal residence	1,300
	State income taxes paid in 2018 (for 2017)	315
Contribution (with written acknowledgement) to church		1,020
Medical insurance		675
Medical and dental expenses		5,785
Income tax return preparation fee paid in 2018		200
Actual general state sales tax for 2018		1,016
Payment of union dues		225

David and Darlene received a letter from Sam's daycare provider which contains information regarding child care expenses.

In 2018, David lost his job. David paid for one month of insurance out-of-pocket and then the family went without insurance for September through December 2018. They are not eligible for any exemptions from health care coverage.

Required: Complete David and Darlene's Form 1040, Schedule 3, Schedule 4, Schedule A, Schedule B, Form 2441, Shared Responsibility Payment Worksheet and Flat Dollar Amount Worksheet.

• Make realistic assumptions about any missing data.
• The taxpayers do not want to make a contribution to the presidential election campaign.
• 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 (unless instructed otherwise on the tax form).
• Assume alternative minimum tax is not a factor.