SOLUTIONS FOR
ADDITIONAL COMPREHENSIVE TAX RETURN PROBLEMS
,
, Solutions for Additional Comprehensive Tax Return Problems 291
Comprehensive Problem 1
1040 U.S. Individual Income Tax Return 2018 (99)
Form
Department of the Treasury—Internal Revenue Service
OMB No. 1545-0074 IRS Use Only—Do not write or staple in this space.
Filing status: Single x Married filing jointly Married filing separately Head of household Qualifying widow(er)
Your first name and initial Last name Your social security number
Noah Arc 434 11 3311
Your standard deduction: Someone can claim you as a dependent You were born before January 2, 1954 You are blind
If joint return, spouse's first name and initial Last name Spouse’s social security number
Joan Arc 456 87 5432
DRAFT AS OF
Spouse standard deduction:
Spouse is blind
Someone can claim your spouse as a dependent
Spouse itemizes on a separate return or you were dual-status alien
Home address (number and street). If you have a P.O. box, see instructions.
1265 W. Riverview Ave.
City, town or post office, state, and ZIP code. If you have a foreign address, attach Schedule 6.
Spouse was born before January 2, 1954
Apt. no.
x Full-year health care coverage
or exempt (see inst.)
Presidential Election Campaign
(see inst.) You Spouse
If more than four dependents,
August 13, 2018
Dayton, OH 45402 see inst. and here a
Dependents (see instructions): (2) Social security number (3) Relationship to you (4) if qualifies for (see inst.):
(1) First name Last name Child tax credit Credit for other dependents
Billie Bob Arc 598 01 2345 Son x
Mary Sue Arc 554 33 2411 Daughter x
Sign
Here DO NOT FILE
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true,
correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
Your signature Date Your occupation If the IRS sent you an Identity Protection
F
PIN, enter it
Joint return?
See instructions. Pet Store Owner here (see inst.)
Keep a copy for Spouse’s signature. If a joint return, both must sign. Date Spouse’s occupation If the IRS sent you an Identity Protection
PIN, enter it
your records.
Firefighter here (see inst.)
Preparer’s name Preparer’s signature PTIN Firm’s EIN Check if:
Paid 3rd Party Designee
Preparer Self-employed
Firm’s name a Phone no.
Use Only
Firm’s address a
For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2018)
, 292 Solutions for Additional Comprehensive Tax Return Problems
Comprehensive Problem 1, cont.
Form 1040 (2018) Noah and Joan Arc 434-11-3311 Page 2
1 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . 1 30,000
2a Tax-exempt interest . . . 2a b Taxable interest . . . 2b
Attach Form(s)
W-2. Also attach 3a Qualified dividends . . . 3a 1,848 b Ordinary dividends . . . 3b 1,848
Form(s) W-2G and
1099-R if tax was 4a IRAs, pensions, and annuities . 4a b Taxable amount . . . 4b
withheld. 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 . . . . . 51,273 6 83,121
7 Adjusted gross income. If you have no adjustments to income, enter the amount from line 6; otherwise,
Standard subtract Schedule 1, line 36, from line 6 . . . . . . . . . . . . . . . . . 7 80,416
DRAFT AS OF
Deduction for— 8 Standard deduction or itemized deductions (from Schedule A) . . . . . . . . . . . . 8 24,000
• Single or married
filing separately, 9 Qualified business income deduction (see instructions) . . . . . . . . . . . . . . 9 7,446 (a)
$12,000
• Married filing
10 Taxable income. Subtract lines 8 and 9 from line 7. If zero or less, enter -0- . . . . . . . . 10 48,970
jointly or Qualifying 11 a Tax (see inst) 4,008 (check if any from: 1 Form(s) 8814 2 Form 4972 3 )
widow(er),
$24,000 b Add any amount from Schedule 2 and check here . . . . . . . . . . . . a 11 4,008
3,450 x 4,008
August 13, 2018
• Head of 12 a Child tax credit/credit for other dependents b Add any amount from Schedule 3 and check here a 12
household,
$18,000 13 Subtract line 12 from line 11. If zero or less, enter -0- . . . . . . . . . . . . . . 13 0
• If you checked
any box under
14 Other taxes. Attach Schedule 4 . . . . . . . . . . . . . . . . . . . . 14 5,409
Standard 15 Total tax. Add lines 13 and 14 . . . . . . . . . . . . . . . . . . . . 15 5,409
deduction,
see instructions. 16 Federal income tax withheld from Forms W-2 and 1099 . . . . . . . . . . . . . 16 5,000
17 Refundable credits: a EIC (see inst.) b Sch 8812 550 c Form 8863
DO NOT FILE
Refund
Direct deposit?
See instructions.
a
a
18
19
20a
b
Add any amount from Schedule 5
Add lines 16 and 17. These are your total payments
8,000 .
.
.
.
.
.
.
.
.
.
If line 18 is more than line 15, subtract line 15 from line 18. This is the amount you overpaid .
Amount of line 19 you want refunded to you. If Form 8888 is attached, check here
Routing number a c Type:
.
.
.
.
.
.
.
.
.
Checking
.
.
.
.
.
.
.
.
.
.
.
.
.
a
Savings
.
.
.
17
18
19
20a
8,550
13,550
8,141
8,141
d Account number
21 Amount of line 19 you want applied to your 2019 estimated tax . . a 21
Amount You Owe 22 Amount you owe. Subtract line 18 from line 15. For details on how to pay, see instructions . . . a 22
23 Estimated tax penalty (see instructions) . . . . . . . . a 23
Go to www.irs.gov/Form1040 for instructions and the latest information. Form 1040 (2018)
(a) (Schedule C of $38,281 + Schedule E $1,655 – Schedule SE $2,705) x 20%.
The taxable income limit is $80,416 – $24,000 – $10,537 (LT Cap Gain) –
$1,848 (Qual Dividends) = $44,031 x 20% = $8,806 and does not apply.
ADDITIONAL COMPREHENSIVE TAX RETURN PROBLEMS
,
, Solutions for Additional Comprehensive Tax Return Problems 291
Comprehensive Problem 1
1040 U.S. Individual Income Tax Return 2018 (99)
Form
Department of the Treasury—Internal Revenue Service
OMB No. 1545-0074 IRS Use Only—Do not write or staple in this space.
Filing status: Single x Married filing jointly Married filing separately Head of household Qualifying widow(er)
Your first name and initial Last name Your social security number
Noah Arc 434 11 3311
Your standard deduction: Someone can claim you as a dependent You were born before January 2, 1954 You are blind
If joint return, spouse's first name and initial Last name Spouse’s social security number
Joan Arc 456 87 5432
DRAFT AS OF
Spouse standard deduction:
Spouse is blind
Someone can claim your spouse as a dependent
Spouse itemizes on a separate return or you were dual-status alien
Home address (number and street). If you have a P.O. box, see instructions.
1265 W. Riverview Ave.
City, town or post office, state, and ZIP code. If you have a foreign address, attach Schedule 6.
Spouse was born before January 2, 1954
Apt. no.
x Full-year health care coverage
or exempt (see inst.)
Presidential Election Campaign
(see inst.) You Spouse
If more than four dependents,
August 13, 2018
Dayton, OH 45402 see inst. and here a
Dependents (see instructions): (2) Social security number (3) Relationship to you (4) if qualifies for (see inst.):
(1) First name Last name Child tax credit Credit for other dependents
Billie Bob Arc 598 01 2345 Son x
Mary Sue Arc 554 33 2411 Daughter x
Sign
Here DO NOT FILE
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true,
correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
Your signature Date Your occupation If the IRS sent you an Identity Protection
F
PIN, enter it
Joint return?
See instructions. Pet Store Owner here (see inst.)
Keep a copy for Spouse’s signature. If a joint return, both must sign. Date Spouse’s occupation If the IRS sent you an Identity Protection
PIN, enter it
your records.
Firefighter here (see inst.)
Preparer’s name Preparer’s signature PTIN Firm’s EIN Check if:
Paid 3rd Party Designee
Preparer Self-employed
Firm’s name a Phone no.
Use Only
Firm’s address a
For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2018)
, 292 Solutions for Additional Comprehensive Tax Return Problems
Comprehensive Problem 1, cont.
Form 1040 (2018) Noah and Joan Arc 434-11-3311 Page 2
1 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . 1 30,000
2a Tax-exempt interest . . . 2a b Taxable interest . . . 2b
Attach Form(s)
W-2. Also attach 3a Qualified dividends . . . 3a 1,848 b Ordinary dividends . . . 3b 1,848
Form(s) W-2G and
1099-R if tax was 4a IRAs, pensions, and annuities . 4a b Taxable amount . . . 4b
withheld. 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 . . . . . 51,273 6 83,121
7 Adjusted gross income. If you have no adjustments to income, enter the amount from line 6; otherwise,
Standard subtract Schedule 1, line 36, from line 6 . . . . . . . . . . . . . . . . . 7 80,416
DRAFT AS OF
Deduction for— 8 Standard deduction or itemized deductions (from Schedule A) . . . . . . . . . . . . 8 24,000
• Single or married
filing separately, 9 Qualified business income deduction (see instructions) . . . . . . . . . . . . . . 9 7,446 (a)
$12,000
• Married filing
10 Taxable income. Subtract lines 8 and 9 from line 7. If zero or less, enter -0- . . . . . . . . 10 48,970
jointly or Qualifying 11 a Tax (see inst) 4,008 (check if any from: 1 Form(s) 8814 2 Form 4972 3 )
widow(er),
$24,000 b Add any amount from Schedule 2 and check here . . . . . . . . . . . . a 11 4,008
3,450 x 4,008
August 13, 2018
• Head of 12 a Child tax credit/credit for other dependents b Add any amount from Schedule 3 and check here a 12
household,
$18,000 13 Subtract line 12 from line 11. If zero or less, enter -0- . . . . . . . . . . . . . . 13 0
• If you checked
any box under
14 Other taxes. Attach Schedule 4 . . . . . . . . . . . . . . . . . . . . 14 5,409
Standard 15 Total tax. Add lines 13 and 14 . . . . . . . . . . . . . . . . . . . . 15 5,409
deduction,
see instructions. 16 Federal income tax withheld from Forms W-2 and 1099 . . . . . . . . . . . . . 16 5,000
17 Refundable credits: a EIC (see inst.) b Sch 8812 550 c Form 8863
DO NOT FILE
Refund
Direct deposit?
See instructions.
a
a
18
19
20a
b
Add any amount from Schedule 5
Add lines 16 and 17. These are your total payments
8,000 .
.
.
.
.
.
.
.
.
.
If line 18 is more than line 15, subtract line 15 from line 18. This is the amount you overpaid .
Amount of line 19 you want refunded to you. If Form 8888 is attached, check here
Routing number a c Type:
.
.
.
.
.
.
.
.
.
Checking
.
.
.
.
.
.
.
.
.
.
.
.
.
a
Savings
.
.
.
17
18
19
20a
8,550
13,550
8,141
8,141
d Account number
21 Amount of line 19 you want applied to your 2019 estimated tax . . a 21
Amount You Owe 22 Amount you owe. Subtract line 18 from line 15. For details on how to pay, see instructions . . . a 22
23 Estimated tax penalty (see instructions) . . . . . . . . a 23
Go to www.irs.gov/Form1040 for instructions and the latest information. Form 1040 (2018)
(a) (Schedule C of $38,281 + Schedule E $1,655 – Schedule SE $2,705) x 20%.
The taxable income limit is $80,416 – $24,000 – $10,537 (LT Cap Gain) –
$1,848 (Qual Dividends) = $44,031 x 20% = $8,806 and does not apply.
