Question

1. Marsellus and Mia have a married niece, Yolanda (age 26), who lives and works in San Francisco, CA. When Yolanda’s husband went to jail for a botched coffee shop robbery in the middle of the CTY, they decided to help Yolanda financially until she could get a higher paying job. They paid her mortgage payments for November and December. The payments included property taxes of $800 and interest of $1,200.
2. For the prior tax year, Marsellus and Mia had a Federal income tax overpayment of $55 that they applied toward their current year tax liability. Mia’s income tax withholdings for the CTY are $12,000 (Federal) and $3,200 (state). Marsellus made quarterly payments of $30,000 (Federal) and $10,000 (state) for a total of $120,000 (Federal) and $40,000 (state).
3. Marsellus and Mia do not have any foreign bank accounts or trusts, and they don’t wish to donate to the presidential election campaign. For the past several years, they have itemized their deductions. They do not have investments in any virtual currency (e.g. Bitcoin).

Mia is filing jointly with her husband Marsellus using the cash basis. How do you treat these activities on their joint 2019 tax return and what tax forms should be used?

Answer 1

1.Yes Mia and Marsellus can jointly file tax return for both case and incidence of tax will be on $2000.A joint tax return will often provide a bigger tax refund or a lower tax liability. However, this is not always the case. A couple may want to investigate their options by calculating the refund or balance due for filing jointly and separately and use the one that provides the biggest refund or the lowest tax liability.

2Taxable amount of states to be clubbed and would be $175200

• Form 1040 is what individual taxpayers use to file their taxes with the IRS.
• The form determines if additional taxes are due or if the filer will receive a tax refund.
• Personal information, such as name, address, Social Security number, and the number of dependents, are asked for on Form 1040.
• A filer also needs to report wages, salary, taxable interest, capital gains, pensions, Social Security benefits, and other types of income.
• Taxpayers may need to file supplemental tax 1040 forms depending on their situation.