Kathy Kennedy (age 44) is a single taxpayer and she lives at 212 North Pine Way, Payson,
Question:
Kathy Kennedy (age 44) is a single taxpayer and she lives at 212 North Pine Way, Payson, AZ 85541. Her Social Security number is 467-98-9784. Kathy's earnings and income tax withholding as the principal of the local high school for 2013 are:
Earnings..........................................................$55,000
Federal income tax withheld.....................................8,800
State income tax withheld.............................................700
Kathy's other income includes qualifying dividends on New Mexico Public Service stock of $4,000 and interest on a certificate of deposit at Payson National Bank of $275. In April 2013, Kathy paid $450 due on her 2012 Arizona state income tax. During the year, Kathy paid the following amounts (all of which can be substantiated):
Home mortgage interest........................................................$9,300
MasterCard interest.................................................................550
Life insurance (whole life policy) ................................................750
Property taxes on personal residence..........................................1,350
Blue Cross medical insurance premiums........................................250
Other medical expenses............................................................560
Income tax preparation fee........................................................300
Charitable contributions (in cash) ...............................................750
Kathy had one stock transaction in 2013. Kathy received the following Form 1099-B from her sale of Gold Company stock. All stock sales must be reported both to taxpayers and to the IRS on Form 1099-B so the proceeds can be matched by the IRS to each tax return. Kathy purchased the stock on August 31, 2012, for $42,800 before the stock plummeted in the last months of 2012.
Step by Step Answer:
Income Tax Fundamentals 2014
ISBN: 9781285424545
32nd Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven Gill