Question

USE THIS INFORMATION AND IMPLEMENT IT ONA FORM 104 TAX YEAR 2017 FORM

THOMAS AND VANESSA KILEY ARE MARRIED. THEY ALWAYS FILE A JOINT TAX RETURN. THEY HAVE ONE SON, RYAN, AGE 14. RYAN IS A DEPENDENT AND SO IS TOM'S ELDERLY MOTHER, ANN KILEY. TOM IS AN ACCOUNTANT AND VANESSA IS SELFEMPLOYED. SHE PROVIDES DATA PROCESSING SERVICES FOR PHYSICIAN CLIENTS. TOM IS 39, VANESSA IS 41, AND ANN IS 66.

THEIR ADDRESS IS 982 WILLIS AVENUE PAWTUCKET, RI 02860.

THOMAS      035-22-6363         RYAN        358-66-1970

VANESSA       037-40-1040          ANN          040-23-7450

INCOME:

THOMAS' SALARY:

TAXABLE WAGES                                                            81,000

FEDERAL INCOME TAX WITHHELD                               6,800

STATE INCOME TAX WITHHELD                                     2,800

VANESSA RECEIVED LIFE INSURANCE PROCEEDS FROM HER DECEASED BROTHER.       50,000

CAPITAL GAIN DISTRIBUTIONS FROM VANGUARD FUNDS.                                          7,600

INTEREST INCOME FROM WEBSTER BANK.                                                                     850

INTEREST INCOME FROM MUNICIPAL BONDS.                                                2,100

DIVIDEND INCOME E*TRADE FUNDS. THE PORTION OF QUALIFIED DIVIDENDS IS                  1,800

$1,200.

GROSS RECEIPTS FROM VANESSA’S DATA PROCESSING BUSINESS. SHE USES THE CASH BASIS. THE BUSINESS BEGAN 1/1/2011.                                                                                                          19,500

VANESSA RECEIVES ALIMONY FROM HER EX-HUSBAND.                                                 6,000

DEDUCTIONS:

THESE ARE VANESSA’S DATA PROCESSING BUSINESS EXPNSES                                     800

PENALTIES PAID TO THE STATE BUSINESS REGULATION DEPARTMENT                      1,200

BUSINESS INSURANCE                                           1,100

OFFICE SUPPLIES                                                          750

TELEPHONE EQUIPMENT RENTAL                                                    1,500

INTERNET                                                                                              900

BUSINESS LICENSE                                                                                600

INTEREST EXPENSE PAID ON THE BUSINESS CREDIT CARD               440

VANESSA USES HER CAR FOR BUSINESS PURPOSES. HER TOTAL MILES FOR THE YEAR IS 8,500 AND THE BUSINESS MILES IS 1,495. SHE USES THE STANDARD MILEAGE METHOD.

VANESSA USES ONE ROOM OF HER HOME AS A HOME OFFICE TO PERFORM THE DATA ENTRY. THE TOTAL SQUARE FOOTAGE OF THE HOME IS 2,400. THE BUSINESS AREA IS 200 SQUARE FEET. SHE USES THE SIMPLIFIED METHOD.

THOMAS PAID STUDENT LOAN INTEREST.

ITEMIZED DEDUCTIONS:

REAL ESTATE TAXES                                                                 3,700

AUTOMIBILE TAXES                                                                300

HOME MORTGAGE INTEREST ON $425,000 MORTGAGE                  10,500

CASH CHARITABLE CONTRIBUTIONS                                                       5,200

THOMAS’ UNREIMBURSED EMPLOYEE EXPENSES                                    1,200

TAX PREPERATION FEES                                                                        300

OUT-OF-POCKET MEDICAL EXPENSES PAID                                            2,400

STATE INCOME TAX BALANCE DUE FOR 2016 PAID IN 2017                      600

VANESSA CONTRIBUTED TO A ROTH IRA.                                               4,000

VANESSA MADE FOUR QUARTERLY ESTIMATED TAX PAYMENTS OF $250.                            1,000

FOREIGN TAXES PAID ON THE E*TRADE MUTUAL FUNDS. THE KILEYS ALWAYS TAKE THEM AS A TAX CREDIT.                                                                                     200

OTHER INFORMATION:

THE FAMILY WAS COVERED BY HEALTH INSURANCE ALL YEAR. THOMAS’ EMPLOYER PAYS THE HEALTH INSURANCE PREMIUMS FOR THE FAMILY. ANN IS COVERED BY MEDICARE INSURANCE.

THE KILEYS WANT THEIR TAX REFUND, IF ANY, TO BE DEPOSITED DIRECTLY INTO THEIR CHEICKING ACCOUNT. THE ROUTING NUMBER IS 011500120 AND THE ACCOUNT NUMBER IS 000654550.

Answer 1

THOMAS`S INCOME TAXABLE WAGES-81000 FEDERAL INCOME TAX WITHHELD-6800 STATE INCOMETAX WITHHELD-2800    TOTAL 90600

VENESSAS`S INCOME   

LIFE INSURANCE PROCEEDS FROM

HER DESEASED BROTHER 50000 CAPITAL GAIN RECEIVED FROM VENGUARDS FUND 7600 INTEREST INCOME FROM WEBSTER BANK 850 INTEREST INCOME FROM MUNICIPAL BOND 2100 DIVIDEND INCOME 1800 ALIMONY FROM EX HUSBAND 6000

BUSINESS INCOME - GROSS RECEIPT-19500

DEDUCTION -BUSINESS EXPENSE 800

PENALTY PAID TO STATE REGULATION DEPARTMENT 1200 BUSINESS INSURANCE 1100 OFFICE SUPPLIES 750 TELEPHONE EQUIPMENT RENTAL 1500 INTEREST 900 BUSINESS LICENSE 600 INTEREST EXPE4NSES ON CREDIT CARD 440 REALESTATE TAXES 200 *3700 308 2400 AUTOMOBILE TAXES 300 HOME MORTGAGE INTEREST 875 UNREAMBURSED EMPLOYEE EXPENSE 1200 TAX PREPARATION FEES 300 OUT OF POCKET MEDICAL EXPENSE PAID 2400 CONTRIBUTION TO A ROTH IRA 4000 BUSINESS INCOME-2827

TOTAL INCOME 71177   

PRIOR PERIOD TAX PAID THIS YEAR 600

ESTIMTED TAX FOR THE YEAR 4000

FOREIGN TAXES TAKEN AS TAX CREDIT 200