Tim and Sarah Lawrence are married and file a joint return. Tim’s Social Security number is 123-45-6789, and Sarah’s Social Security number is 111-11-1111. They reside at 100 Olive Lane, Covington, LA 70434. They have two dependent children, Sean and Debra, ages 12 and 16, respectively. Sean’s Social Security number is 123-45-6788, and Debra’s Social Security number is 123-45-6787. Tim is a self-employed businessperson (sole proprietor of an unincorporated business), and Sarah is a corporate executive. Tim has the following income and expenses from his business.
Gross income ...............................................................................................................................  $325,000
Business expenses ......................................................................................................................   201,000
Records related to Sarah’s employment provide the following information.
Salary ............................................................................................................................................ $145,000
Unreimbursed travel expenses (including $200 of meals) .....................................................      1,100
Unreimbursed entertainment expenses ..................................................................................         500
Other pertinent information for the tax year includes the following.
Proceeds from sale of stock acquired on July 15, 2017 (cost of $12,000),
and sold on August 1, 2017 ........................................................................................................   $ 9,800
Proceeds from sale of stock acquired on September 18, 2016
(cost of $5,000), and sold on October 5, 2017 .........................................................................      3,800
Wages paid to full-time domestic worker for housekeeping and
child supervision ..........................................................................................................................   10,000
Interest income received ............................................................................................................     7,000
Total itemized deductions (not including any potential deductions above) .......................    27,900
Federal income tax withheld ....................................................................................................    31,850
Estimated payments of Federal income tax ...........................................................................    34,000
Compute the net tax payable or refund due for Tim and Sarah Lawrence for 2017.