Wages = $ 15,000.00
Federal W/H = $ 1,500.00
Social security wages = $ 15,000.00
Social security W/H = $ 930.00
Medicare wages = $ 15,000.00
Medicare W/H = $ 217.50
Their itemized deductions are as follows:
Mortgage interest on their main home, $10,500.
Real estate taxes, $5,600.
Personal property taxes, $185.
Doctors’ expenses unreimbursed by insurance, $7,400.
Medical insurance premiums for the year, $2,400.
Prescribed medicine, $1,995.
Vitamins, $300.
Total cash contributions to their church, $675. The contributions were made over the course of the year and no individual contribution was greater than $250.
Tax preparation fees for their 2017 return, $325, paid in 2018.
Lottery tickets bought by Esther during the year, $750. Winnings received, $940 (W-2G, box 1). Income tax withholding on winnings, $35 (W-2G, box 4).
Because the Johnsons live in Florida, where there is no state income tax, they will deduct the estimation of the general sales tax related to the area in which they live. The most efficient way to do this is by using the Sales Tax Calculator on the IRS website at https://www.irs.gov/Individuals/Sales-Tax-Deduction-Calculator. A key point to remember in using the calculator is that “income” for this calculation also includes the nontaxable portion of social security benefits.
Prepare their individual income tax return using the appropriate forms. They do not want to contribute to the presidential election campaign and do not want anyone to be a third-party designee. For any missing information, make reasonable assumptions. They had qualifying health coverage at all times during the year. (List the names of the taxpayers and any income they receive in the order in which they appear in the problem. Input all the values as positive numbers unless otherwise stated in the forms. Instructions can be found on certain cells within the forms. Round your final answers to the nearest whole dollar amount.)
Use the appropriate Tax Tables.
Page 2 of Form 1040. Some information does not carry over from Page 1.
Form 1040 (2018) James Johnson Esther Johnson 412-34-5670 Page 2
1 Wages, salaries, tips, etc. Attach Form W-2 1
2a Tax-exempt interest 2a 42,448 b Taxable interest 2b
3a Qualified dividends 3a b Ordinary dividends 3b
4a IRAs, pensions, and annuities 4a b Taxable amount 4b
Standard deduction for- 5a Social security benefits 5a b Taxable amount 5b
6 Total income. Add lines 1 through 5. Add any amount from Schedule 1, line 22 6
7 Adjusted gross income. If you have no adjustments to income, enter the amount from line 6; otherwise, subtract Schedule 1,
● Single or Married filing separately, $12,000 line 36, from line 6 7
8 Enter the standard deduction; otherwise, attach Schedule A 8
9 Qualified business income deduction (see instructions) 9
● Married filing jointly or Qualifying widow(er), $24,000 10 Taxable income. Subtract lines 8 and 9 from line 7. If zero or less, enter -0- 10
11 a Tax (see inst) (check if any form:
- Form(s) 8814checkbox unchecked1 of 3
- Form 4972checkbox unchecked2 of 3
3.checkbox unchecked3 of 3 )
b Add any amount from Schedule 2 and check here ▶
checkbox unchecked1 of 1 11
● Head of household, $18,000 12 a Child tax credit/credit for other dependents
b Add any amount from Schedule 3 and check here ▶
checkbox unchecked1 of 1 12
13 Subtract line 12 from line 11. If zero or less, enter -0- 13 0
14 Other taxes. Attach Schedule 4 14
● If you checked any box under Standard deduction, see instructions. 15 Total tax. Add lines 13 and 14 15 0
16 Federal income tax withheld from Forms W-2 and 1099 16
17 Refundable credits: a EIC (see inst.) b Sch 8812
c Form 8863 d Add any amount from Schedule 5
18 Add lines 16 and 17 a through d. These are your total payments. 18 0
Refund 19 If line 18 is more than line 15, subtract line 15 from line 18. This is the amount you overpaid 19 0
20a Amount of line 19 you want refunded to you. If Form 8888 is attached, check here ▶
checkbox unchecked1 of 1 20a 0
Direct deposit? See instructions. ▶b Routing number ▶ c Type:
Checkingcheckbox unchecked1 of 1
Savingscheckbox unchecked1 of 1
▶d Account number
21 Amount of line 19 you want applied to your 2019 estimated tax ▶ 21
Amount You Owe 22 Amount you owe. Subtract line 18 from line 15. For details on how to pay, see instructions ▶ 22
23 Estimated tax penalty (see instructions) ▶ 23
UYA Form 1040 (2018)
Sample Solution
