FOR TAX YEAR 2019 (must use 2019 forms). USE THE LAW AS IT EXIST FOR 2019.
Question Get Answer

Could you fill out the tax forms for this tax return please.


FOR TAX YEAR 2019 (must use 2019 forms). USE THE LAW AS IT EXIST FOR


2019. FOR EXAMPLE, USE 2019 AMOUNTS FOR STANDARD DEDUCTION,


PHASEOUT AMOUNTS, ETC.


Your clients, Chandler and Monica Bing have hired you to complete their 2019 tax


return (2019 tax year). They wish to pay the minimum amount of taxes possible in this


tax year.


Disregard AMT.


They have provided you with the following information.


General information


(All ages as of Dec 31, 2019)


They provide the majority of the support and home for their two adopted children, Jack


and Erica. The children were NOT adopted in 2019.


They also provide 100% support for "Uncle Joey." Joey is not biologically the uncle to


Erica or Jack, but he does live with the Bings full-time in his "Joey room." Joey's only


source of income in 2019 is a settlement from a jam related injury he sustained in the


amount of $1,500 for bodily injury and $4,000 for compensatory damages.


Monica's mother, (Judith Geller) lives near Monica and Chandler in her own apartment


which Monica pays for ($15,000 per year - including utilities) starting in May after her


dad died. Except for $80,000 which Judith received in Sept. 2019 as an inheritance



from her deceased husband's estate (her husband died in May. 2019), she has no other


source of income (assume she receives no social security).


The Bing's friend Phoebe died in January 2019 and she left a lump sum of $200,000 in


life insurance proceeds to the Bings, which Chandler invested in mutual stock funds and


an interest-bearing cash account at Edward Jones - see below.


Monica's friend Richard gifted an antique mustache comb to Chandler. Its fair market


value is $1,100 and Richard's cost to acquire the comb was $50.


Chandler won $1,200 from a Texas Lotto game. He paid $250 total for several tickets


and retained the receipts. Chandler lost gross $300 rolling dice. He had no other


winnings and has documentation.


Chandler's information


Chandler works as an advertising executive. He received a W-2 (see attached).


Chandler is eligible for a bonus each year. Based upon his performance in 2019 he will


receive a $10,000 bonus. The bonus is paid in January 2020.


His firm does NOT reimburse him for any out of pocket expenses that he may incur.


Chandler adopted a duck and a chick from a local pet store. Adoption fees were $30.


Monica's Information


Monica is a cash basis, self-employed chef with her own restaurant. She didn't receive


any 1099-Misc forms, but her total deposits in her business bank account for 2019 show


$251,723. In addition to amounts collected from the restaurant, she also received a


payment of $5,000 in cash on Dec 31, 2019 from a former catering client for a catering



job she performed in late 2017. She did not receive a Form 1099 for this amount and


she did not put this amount in her bank account.


Monica rents a space to have her restaurant, but Monica also uses a small room (100


sq ft) in her home (2,000 sq ft) to keep up with payroll, order supplies, and other


administrative duties. She uses her SS number in lieu of an EIN. She incurred the


following business related expenses during the year:


Restaurant Expenses (utilized at Restaurant)


Printing/copying


$2,963


Legal fees


$1,200


Supplies


$3,617


Internet Service used 100% for her work


$1,200


Postage/UPS


$296


Premium for Insurance Policy (100% Business)


$1,175


Worker Salaries (assume contract labor) $78,693


Utilities


$12,159


Rent


$12,000


Cost of Food Sold


$25,476


Home Expenses


Lawn Care


$1,500


Security


$600


Utilities


$3,623


During 2019 Monica purchased new appliances in March to use in her restaurant


business. The cost of the equipment was $16,825. She wishes to maximize her


depreciation deduction.



Addition information Interest Income


:


Interest from a City of New York municipal bond (see 1099-INT)


AT&T bond (see 1099-INT)


Edward Jones Money Market (see 1099-INT)


DO NOT FILE ANY FORMS RELATING TO FOREIGN ACCOUNTS


Dividend Income


:


Chandler's American Mutual Funds Account at Edward Jones


(see 1099-DIV)


Stock Transactions


: ASSUME IRS NOTIFICATION WAS PROVIDED BY BROKER


Nintendo, 5 shares sold, net sales proceeds from broker $2,000;


Date sold 03/1/2019, Basis $ 50 per share, date purchased 10/3/2015


Apple, 30 shares sold, net sales proceeds from broker $300;


Date sold 4/2/2019, Basis $150 per share, date purchased 1/10/2018


Sony, 10 shares sold, net sales proceeds from broker $100;


Date sold 4/1/16, Basis $1 per share, date purchased 4/1/2015


Rental Property


Monica and Chandler purchased a rental property in April 2013. For 2019 they had


rental income of $25,000. The property's address is 4506 Stassney, Austin Texas


78704



The expenses for the year were as follows:


Mortgage interest (see 1098)


Repairs and maintenance


2,654


Insurance


2,963


DO NOT CONSIDER DEPRECIATION FOR THIS PROPERTY.


Other Investments


Business #1 (Viva Las Gaygas). They invested $10,000 for a 75% share in this


business. Chandler is a material participant in this business. The business had a profit


of $10,000 in 2019. See K-1 for details.


Report the net taxable income from this investment on Sch E, Part II.


Do not fill out


passive activity forms)


Medical Expenses (unreimbursed portions)


Premiums for health insurance for the family


$12,800


(this is the after tax portion Chandler had to pay for the medical Plan provided


by his employer)


Medicine and drugs (prescription)


3,589


Eyeglasses


1,500


Other Unreimbursed "qualified" medical expenses paid by


the taxpayer


in 2019


-


all relating to doctor care and a hospital stay


when Joey fell and broke his collarbone.....again, etc.


24,000



Mileage to & from a medical clinic in Houston (475 miles on Dec 11, 2018)


Interest


Home Mortgage paid on San Marcos home paid to Country (see form (1098)


Mortgage paid on rental house (paid to Chase) (see form 1098)


Business Use Credit Card (100%) used by Monica for her business $500


Taxes


Real Estate Taxes - Home


$ 4,800


Real Estate Taxes - rental house


5,000


Contributions (you have verified all dates as correct)


All "cash" and clients have all required receipts and required documentation. (all are IRS


recognized non-profit organizations)


Salvation Army (check dated in 6/20/19)


175


Girl Scouts of America (ck dated 04/05/19, received cookies worth $10)


$210


Church (paid by check dated 10/11/19)


7,200


Other/Miscellaneous


CPA fees


Income Tax preparation fees (paid in May 2019 for 2018 return $ 2,000


assume 50% is related to Monica's Sch C)


Chandler's unreimbursed "work related" office supplies


1,175



Chandler's airfare to a one-day business meeting in Tulsa, OK


850


Interest paid on Chandler's student loan (got his master's in 2014) $2,800


Child care Expenses


Paid for twins: Five Star After-School Care,


Austin, TX ID# 05-3434567 (two days a week)


$ 7,850


Estimated Taxes Paid (on time)


Paid $1,000 for each of the four quarters; total of $4,000.


Needed: Your textbook, IRS Forms, and references such as Pub 17


PREPARE the couple's joint tax return for 2019. Assume that they want to claim the maximum


amount of deductions possible and pay the minimum amount of taxes.


Make sure to use the 2019 TAX RATES SCHEDULES


Turn in a fully prepared tax return with all required schedules just as if this was being filed with


the IRS- use supporting working papers and/or schedules which can help explain your


computations For example, if there is not enough lines to schedule out your totals, use a


supporting schedule which shows how you arrived at the total. DO NOT TURN IN EXTRA


PAPERWORK NOT REQUIRED BY THE IRS.


Only attach required forms and schedules. Points will be deducted for non-necessary forms or


attachments.


If any deductions are limited attach a worksheet showing the calculation of the


limitation.

Subject: Accounting, Business

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Let our 24/7 Accounting tutors help you get unstuck! Ask your first question.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes