ACC $246$: Individual Tax Return $-$ Dunphy Please use $2023$ tax law. Required: $$ Using TaxAct software and the following information, complete Phillip and Claire Dunphy$$s $2023$ federal income tax return. If any information is missing, use reasonable assumptions to fill in the gaps. $$ You will be entering information as if you have source documents $($Forms W$-2,1099-$INT, $1099-$DIV, $1099-$B$,$ etc.$).$ Do not summarize information $$ if there is more than one source of interest, for example, enter more than one $1099-$INT form into the software. Remember: While you can put numbers directly into the Form $1040,$ you will not receive credit unless the information is entered via source documents. $$ For reference, the forms, schedules, and instructions can be found at the IRS website $($www$.$irs.gov$).$ The instructions can be helpful in completing the forms. Facts: $1.$ Phillip and Claire are married and file a joint return. Phillip is self$-$employed as a real estate agent, and Claire is a flight attendant. Phillip and Claire have three dependent children. All three children lived at home with Phillip and Claire for the entire year. The Dunphys provide you with the following additional information: $$ The Dunphys do not want to contribute to the presidential election campaign. $$ The Dunphys live at $3701$ Brighton Avenue, Los Angeles, California $90018.$ Phillip$$s birthday is $11/5/1977$ and his Social Security number is $321-11-5766.$ Claire$$s birthday is $5/12/1980$ and her Social Security number is $567-11-1258.$ Haley$$s birthday is $11/6/2011$ and her Social Security number is $621-11-7592.$ Alex$$s birthday is $2/1/2013$ and her Social Security number is $621-11-8754.$ Luke$$s birthday is $12/12/2017$ and his Social Security number is $621-11-9926.$ The Dunphys do not have any foreign bank accounts or trusts. $2.$ Claire is a flight attendant for Western American Airlines $($WAA$),$ where she earned $$57,000$ in salary. WAA withheld federal income tax of $$6,375,$ state income tax of $$1,800,$ Los Angeles city income tax of $$675,$ Social Security tax of $$3,600,$ and Medicare tax of $$825.3.$ Phillip and Claire received $$300$ of interest from State Savings Bank on a joint account. They also received a qualified dividend of $$395$ on jointly owned stock in Xila Corporation. $4.$ Phillip$$s full$-$time real estate business is Phillip Dunphy Realty. His business is located at $645$ Grove Street, Los Angeles, California $90018,$ and his employer identification number is $93-3488888.$ Phillip$$s gross receipts during the year were $$730,000.$ Phillip uses the cash method of accounting for his business. Phillip$$s business expenses are as follows: Advertising Rent $ $5,00015,515$ Professional dues $800$ Professional journals $200$ Employee wages $48,000$ Insurance on office contents $1,120$ Accounting services $2,100$ Miscellaneous office expense $500$ Utilities and telephone $3,360$ Payroll taxes $3,600$ Depreciation To be calculated $5.$ On March $20,2023,$ Phillip moved his business out of the old offices at $1103$ Allium Lane and into a newly constructed and equipped office on Grove Street. Previously, Philip previously rented furnished and equipment office space, therefore he does not have to record depreciation on assets placed in service in prior years, nor does he have a sale of business assets. Phillip$$s expenditures for the new office building are as follows: Date Acquired Asset Cost $3/20/2023$ Land $ $300,0003/20/2023$ Office building $2,500,0003/20/2023$ Furniture $200,0004/1/2023$ Computer system $350,0006/1/2023$ Artwork $150,000$ Note that the Artwork is not expected to depreciate in value nor be subject to normal wear and tear. $6.$ Phillip computes his cost recovery allowance using MACRS. He would like to use the $179$ immediate expensing for the furniture and computer system. He has elected to not claim any bonus depreciation. Phillip has never claimed $179$ or bonus depreciation before. $7.$ Phillip and Claire donated $$350$ to the Salvation Army during $2023.8.$ The Dunphys sold $60$ shares of Fizbo Corporation common stock on September $3$ for $$65$ a share $($minus a $$50$ total commission$).$ The Dunphys purchased the stock on November $8,2022,$ for $$90$ a share. They also sold a painting for $$13,000$ on March $1.$ Claire purchased the painting for $$20,050$ on September $1,2014,$ as an investment. $9.$ The Dunphys filed their $2022$ federal, state, and local returns on April $13,2023.$ They paid the following additional $2022$ taxes with their returns: federal income taxes of $$630,$ state income taxes of $$250,$ and city income taxes of $$75.10.$ The Dunphys did not buy, sell, exchange, or otherwise acquire any financial interest in a virtual currency.