Joe and Sharon Racca are married and have two children. Joe works as a sales manager for a national pharmaceutical company and Sharon is a nurse. They own a vacation home in New Hampshire that is used 30% for personal purposes. During the year they receive $1,600 in reimbursements from their medical plan and report $2,200 of investment income. They contributed stock with a fair market value of $4,000 that they acquired in 2001 at a cost of $1,700 to Stanton College. The Raccas’ gambling winnings for the year were $1,000 and are included in their adjusted gross income. Their adjusted gross income for the year is $88,000 and they provide you with the following data:

Automobile insurance ............ $1,450

Homeowners’ insurance .............. 625

Life insurance .................. 980

Disability insurance ............... 375

Health insurance premiums ............ 1,420

Country club dues .............. 1,800

Health club dues ............... 750

Hospital ................... 3,500

Doctor ..................... 875

Chiropractor .................. 650

Dentists ................... 1,750

Prescription drugs ............... 275

Over-the-counter drugs ............. 460

State taxes withheld .............. 3,475

Property taxes (ad valorem) ............. 320

Investment interest .............. 1,600

Mortgage interest (primary residence) ...... 6,850

Real estate taxes (primary residence) ....... 2,240

Mortgage interest (vacation residence—unallocated) . 3,000

Real estate taxes (vacation residence—unallocated) . 1,350

Charitable contributions (cash) .......... 8,435

Charitable contribution (clothes at FMV) ....... 100

Investment advice ................ 425

Subscriptions to investment journals ...... 225

Dues to professional organizations ........ 375

Attorney fee for tax advice on dispute with IRS . 525

Parking at work .............. 190

Safe-deposit box .............. 75

Tax return preparation ........... 400

Gambling losses ............... 650

Union dues ................. 310

Nurse’s uniform ............... 225

Unreimbursed employee business expenses (after allocation but before limitations)

Airfare ...... $600

Lodging ...... 450

Meals ....... 390

Entertainment .... 280

Incidentals ...... 150

Complete Form 1040 Schedule A. Joe’s Social Security number is 063-79-4105 and Sharon’s Social Security number is 530-22-6584. Forms and instructions can be downloaded from the IRS Web site (www.irs.gov/).