Ray and Maria Gomez have been married for 3 years. They live at 1610 Quince Ave., McAllen,


Ray and Maria Gomez have been married for 3 years. They live at 1610 Quince Ave., McAllen, TX 78701. Ray is a propane salesman for Palm Oil Corporation and Maria works as a city clerk for the City of McAllen. Maria’s Social Security number is 444-65-9912 and Ray’s is 469-21-5523. Ray’s birthdate is February 21, 1988 and Marie’s is December 30, 1990. Ray and Maria’s earnings are reported on the following Form W-2s:

Ray and Maria have interest income of $641 from a savings account at McAllen State Bank. In addition, they own U.S. Savings bonds (Series EE). The bonds had a value of $10,000 on January 1, 2016, and their value is $10,700 on December 31, 2016. They have not made an election with respect to these bonds.

Ray has an ex-wife named Judy Gomez. Pursuant to their divorce decree, Ray pays her $455 per month in alimony. All payments were made on time in 2016. Judy’s Social Security number is 566-74-8765.

During 2016, Ray was in the hospital for a successful operation. His health insurance company reimbursed Ray $4,732 for all of his hospital and doctor bills.

In June of 2016, Maria’s father died. Under a life insurance policy owned and paid for by her father, Maria was paid death benefits of $25,000.

Maria bought a Texas lottery ticket on impulse during 2016. Her ticket was luck and she won $3,900. The winning amount was paid to Maria in November 2016, with no income tax withheld.

Palm Oil Corporation provides Ray with a company car to drive while he is working. The Corporation spent $5,000 to maintain this vehicle during 2016. Ray never uses the car for personal purposes.

Required: Complete the Gomez’s federal tax return for 2016. Use Form 1040 on Pages 2-53 and 2-54. Make realistic assumptions about any missing data.

Form 1040:

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Income Tax Fundamentals 2017

ISBN: 9781305872738

35th Edition

Authors: Gerald E. Whittenburg, Steven Gill, Martha Altus Buller

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