Question

-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 in 2019. aros $325,000 Gross income 201,000 Business expenses Records related to Sarah's employment provide the following information. $145,000 Salary Unreimbursed travel expenses (including $200 of meals) 1,600 Other pertinent information for the tax year includes the following. Proceeds from sale of stock acquired on July 15, 2019 (cost of $12,000), and sold on August 1, 2019 Proceeds from sale of stock acquired on September 18, 2018 (cost of $5,000), and sold on October 5, 2019 Wages paid to full-time domestic worker for housekeeping and child supervision Interest income received Total itemized deductions (not including any potential deductions above) $9,800 3,800 10,000 7,000 Federal income tax withheld 27,900 Estimated payments of Federal income tax 31,850 Compute the net tax payable or refund due for Tim and Sarah Lawrence for 2019. 20,000

Answer 1

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