Question

Instructions:

Please complete the 2018 federal income tax return for Bill Hales. Be sure to include only required tax forms when completing the tax return. Ignore the requirement to attach the form(s) W-2 to the front page of the Form 1040. If required information is missing, use reasonable assumptions to fill in the gaps.

Bill Hales attended State University as a part-time student during the year. Bill lived at home with his parents while working a part-time job. The following information relates to 2018:

• Bill’s Social Security number is 546-87-9876
• His mailing address is 123 Spring Lane, Willow, Texas 77521
• Bill is a U.S citizen
• Bill was single during the entire year
• Bill turned 19 on July 1
• Bill does not have any children or provide support for anyone but himself
• Bill lived in a room in the basement of his parents’ home for all 12 months of the year
• For the year Bill’s parents provided $16,500 of support including room and board, a car, health insurance, clothing, education, and car insurance.
• Bill was included on his father’s qualified minimum health insurance coverage plan for all 12 months during the year.

Bill received the following income during the year:

Employer	Gross Wages	Federal Income Tax Withholding	State Income Tax Withholding
The Colony	3,675	165	0
Rock Climbing, LLC	1,790	0	0
Community Pool, Inc.	4,235	240	0

All applicable and appropriate payroll taxes were withheld by his various employers.

Bill received $12 in interest income from the First Bank of Texas during the year. Bill did not own, control, or manage any foreign bank accounts, nor was he a grantor or beneficiary of a foreign trust during the tax year.

Bill had no itemized deductions.

Bill does not want to contribute to the Presidential Election Campaign Fund. He would like to receive a refund (if any) of any tax he may have overpaid for the year. His preferred method of receiving the refund is by check.

Answer 1

Answer :

Calculation of federal Tax liability as per for 1040 Bill for the year 2018

Particulars	Amount ($)
Gross wages	9700	The colony = 3675 Rock climbing = 1790 community pool = 4235 Total = 9700
Interest	12
Income from exemption and deduction	9712
Less : Standard deduction	(9712)	Total standard deduction allowed per single status fillers up-to 12000, so in this case it is allowed up -to 9712 as taxable income is $9712
Tax liability	0
Federal income tax withholding	405	= 165 + 240
Refund	$405

Total refund Bill will be getting $405

Bill is above 19 years and living with his parents and getting a support from his parents of $16500 for his education, clothing , health insurance ect as this is assumed that he his getting full support and full dependent on his parents

As he is above 19 years and he is part time student so his parents are only liable of 500 child tax credit tax in section other dependent credits as per federal tax laws .

Bill will not be eligible for any educational credit also.

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