The given solution is classified in below
WN-1 | ||||||||
Cost of Annuity | $46,800 | |||||||
Monthly Payments | $450 | |||||||
Number of Monthly Payments | 260 | |||||||
Exclusion percentage of annuity | 40% | |||||||
contract cecil purchased =cost of | ||||||||
annuity /monthly payments*no of | ||||||||
payments | ||||||||
$46800/($450*260) | ||||||||
Annuity received from group | $5,400 | |||||||
insurance | ||||||||
Annual Exclusion on annuity contract | $2,160 | |||||||
annuity received*exclusion% | ||||||||
$5400*40% | ||||||||
Annuity Payment included in Gross | ||||||||
Income =Annuity Received-Annual exclusion | ||||||||
$5400-$2160 | $3,240 | |||||||
WN2 | ||||||||
Amount of social security benefits | ||||||||
that included in gross income is | ||||||||
lesser of the following amount | ||||||||
$14000*85% | $11,900 | |||||||
WN3 | ||||||||
Interest on gift loan | ||||||||
Cecil made below market loan of | ||||||||
amount $60000 to her daughter | ||||||||
qualifies for $100000 loan exception | ||||||||
earned net income of $1500 from | ||||||||
investment | ||||||||
It must include cecils gross income | ||||||||
instead of $60000*6%(Federal Tax) | $3,600 | |||||||
WN4 | ||||||||
Net Rental Income from town house | ||||||||
Rent Income | $9,000 | |||||||
Less Expenses | ||||||||
Utilities | $2,800 | |||||||
Maintenance | $1,000 | |||||||
Real Estate Taxes | $750 | |||||||
Insurance | $700 | |||||||
Depreciation | $2,000 | |||||||
Net Rental Income | $1,750 | |||||||
WN5 | ||||||||
Cecil does not qualify for a dependency | ||||||||
deduction as her daughter is independent | ||||||||
Computation Cecil 2018 Federal income tax payable | ||||||||
Gross Income | ||||||||
pension | $39,850 | |||||||
Interest income | $5,500 | |||||||
dividend income | $2,000 | |||||||
annuity income as WN1 | $3,240 | |||||||
Social security benefits as per WN2 | $11,900 | |||||||
Imputed interest on gift | $1,600 | |||||||
as per WN3 | ||||||||
Net Rental Income | $1,750 | |||||||
as per WN4 | ||||||||
Gross Income | $65,840 | |||||||
Deduction for AGI | 0 | |||||||
AGI | $65,840 | |||||||
Less:Personal Exemption as per WN5 | ($3,950) | |||||||
Less :Itemized Deduction | ($13,000) | |||||||
Taxable Income | $48,890 | |||||||
Tax Liability | $6,676 | |||||||
Less Estimated Tax Payments | ($5,900) | |||||||
Net tax payable or refund for 2018 | $776 | |||||||
Calculation of tax liability | ||||||||
Married filing jointly or qualifying | ||||||||
widow /widower 10% upto $18150 | ||||||||
15%=18151 to 73800 | ||||||||
18150 *10% | $1,815 | |||||||
Taxable Income($48890-$18151)*15% | $4,611 | |||||||
Tax Liability | $6,426 | |||||||
Add tax on dividend income | $250 | |||||||
5%*2000 | ||||||||
$6,676 |
Cecil C. Seymour is a 64-year-old widower. He had income for 2018 as follows: Pension from...
Cecil C. Seymour is a 64-year-old widower. He had income for 2020 as follows: Pension from former employer $39,850 Interest income from Alto National Bank $5,500 Interest income on City of Alto bonds $4,500 Dividends received from IBM stock held for over one year $2,000 Collections on annuity contract he purchased from Great Life Insurance $5,400 Social Security benefits $14,000 Rent income on townhouse $9,000 The cost of the annuity was $46,800, and Cecil was expected to receive a total...
Note: This problem is for the 2018 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred's Social Security number is 111-11-1109. Beulah's Social Security number is 123-45-6780, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay...
Note: This problem is for the 2018 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred's Social Security number is 111-11-1112. Beulah's Social Security number is 123-45-6789, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay...
Instructions Note: This problem is for the 2019 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2017. Alfred and Beulah will file a joint return for 2019. Alfred's Social Security number is 111-11-1109. Beulah's Social Security number is 123-45-6780, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to...
Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred’s Social Security number is 111-11-1112. Beulah’s Social Security number is 123-45-6789, and she adopted “Old” as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10 years...
Please prepare a 2017 1040 and schedule A Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred's Social Security number is 1-11-1112. Beulah's Social Security number is 123-45-6789, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah...
Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred’s Social Security number is 111-11-1112. Beulah’s Social Security number is 123-45-6789, and she adopted “Old” as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10 years...
Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2016. Alfred and Beulah will file a joint return for 2018. Alfred’s Social Security number is 111- 11-1112. Beulah’s Social Security number is 123-45-6789, and she adopted “Old” as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10...
Marcus is a 51 year old widower whose wife died in 2017. During 2018, his 16 year old dependent son lived with him for the entire tax year. Marcus's 2018 income consists of salary of $91,000 and interest income of $19,400. He lives in a state that does not have a state income tax. During the year He paid home mortgage interest expense of $21,000 and real estate taxes of $6,200. He also contributed $10,000 in cash to various charities...
Instructions: Please complete the 2018 federal income tax return for Sarah Hamblin. Be sure to include only required tax forms when completing the tax return. For purposes of this assignment, unless instructed otherwise, you do not need to attach Form 8582. Also, 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. Sarah Hamblin and her now ex-husband Kevin were legally...