Instructions Assignment 1: 1040 Tax Return Facts: Sally Student 123 Maple Street Cincinnati, Ohio 44000 Social Security No. 123-45-6789
Sally is a 30-year old single person. She is an accountant and also works a side weekend job in an art gallery. She is not claimed as a dependent by anyone else. For 20XX, she had the following INCOME: 1. W-2 from 1st employer Gross wages income: $13,164 Federal Withholding $ 921 2. W-2 from 2d employer Gross wages $50,000.00 Federal withholding $ 9,500.00 3. Interest income from bank $132.00 4 Interest from brokerage firm $2,100.00 5. Ordinary “qualified” dividends from large U.S. Corporation: $3,000.00
POSSIBLE DEDUCTIONS 1. Mortgage interest paid $6,700 2. State and local income taxes paid $1,400 3. Charitable contributions to a 501( c)(3) charity $1,800.00 4. Casualty loss, her garage was destroyed by fire. Cost and fair market value were $9,000. Insurance only paid $3,000 5. Property taxes on her home: $2,600 Go the IRS website at irs.gov, and get a Form 1040, Form 4684 and form 8283 and instructions, and also a Schedule A and B. Use these, with the facts above, to prepare a Form 1040 for Sally for the most recent year for which there is a form (this is almost always the year prior to the present year). Remember to consider both the standard deduction vs. itemized deduction, and the personal exemption, if any. Also, you may need other forms, such as the 4684 and instructions. Be sure to include the tax calculation worksheet from the instructions (qualifying dividends and capital gains) with your assignment. If a form results in zero, be sure to still include it with your assignment so that it can be graded and proof that you learned how to complete the form. Include all forms in the submission.
