all Information provided, no missing information

Note: This problem is for the 2021 tax year.

Janice Morgan, age 24, is single and has no dependents. She is a freelance writer. In January 2021, Janice opened her own office located at 2751 Waldham Road, Pleasant Hill, NM 88135. She called her business Writers Anonymous. Janice is a cash basis taxpayer. She lives at 132 Stone Avenue, Pleasant Hill, NM 88135. Her Social Security number is 123-45-6782. Janice's parents continue to provide health insurance for her under their policy. Janice did not engage in any virtual currency transactions during the year and wants to contribute to the Presidential Election Campaign Fund. Janice received the appropriate coronavirus recovery rebates (economic impact payments); related questions in ProConnect Tax should be ignored.

During 2021, Janice reported the following income and expense items connected with her business.

Income from sale of articles	$95,000
Rent	16,500
Utilities	7,900
Supplies	1,800
Insurance	5,000
Travel (including restaurant meals of $600)	2,900

Janice purchased and placed in service the following fixed assets for her business. Janice wants to elect immediate expensing under 179, if possible.

• Furniture and fixtures (new) costing $21,000 on January 10
• Computer equipment (new) costing $12,400 on July 28

Janice's itemized deductions include:

State income tax	$2,950
Home mortgage interest paid to First National Bank	8,000
Property taxes on home	2,500
Charitable contribution to her alma mater, State College	1,200

Janice did not keep a record of the sales tax she paid. The amount allowed by the sales tax table is $437. Janice reports interest income of $4,000 on certificates of deposit at Second National Bank. She made estimated tax payments of $5,000 for 2021.

Required: Compute Janice Morgan's 2021 Federal income tax payable (or refund due).

• Make realistic assumptions about any missing data.
• If an amount box does not require an entry or the answer is zero, enter "0".
• Enter all amounts as positive numbers.
• The taxpayer wants $3 to go to the to Presidential Election Campaign.
• It may be necessary to complete the other tax forms and schedules before completing Form 1040.
• Use the tax schedules (not the tax tables) included with this problem to compute the tax.
• If required, round your final answers to the nearest dollar.

2021 Tax Rate Schedules Use the 2021 Tax Rate Schedules to compute the tax. (Note: Because the tax rate schedules are used instead of the tax tables, the amount of tax computed may vary slightly from the amount listed in the tables.) 2021 Tax Rate Schedules Single-Schedule X Head of household-Schedule Z If taxable of the If taxable of the income is: But not amount income is: But not amount Over- over- The tax is: over- Over- over- The tax is: over- $ 9,950 . . . . 10% $ 14,200 9,950 40,525 $ 995.00 + 12% 9,950 14,200 54,200 $ 1,420.00 + 12% 14,200 40,525 86,375 4,664.00 + 22% 40,525 54,200 86,350 6,220.00 + 22% 54,200 86,375 164,925 14,751.00 + 24% 86,375 86,350 164,900 13,293.00 + 24% 86,350 164,925 209,425 33,603.00 + 32% 164,925 164,900 209,400 32,145.00 + 32% 164,900 209,425 523,600 47,843.00 + 35% 209,425 209,400 523,600 46,385.00 + 35% 209,400 523,600 157,804.25 + 37% 523,600 523,600 156,355.00 + 37% 523,600 Married filing jointly or Qualifying widow(er)-Schedule Y-1 Married filing separately-Schedule Y-2 If taxable of the If taxable of the income is: But not amount income is: But not amount Over- over- The tax is: over- Over- over- The tax is: over- $0 $ 19,900 " . .. 10% $0 $0 $ 9,950 1. . .. 109% 19,900 81,050 $ 1,990.00 + 12% 19,900 9,950 40,525 $ 995.00 + 12% 9,950 81,050 172,750 9,328.00 + 22% 81,050 40,525 86,375 4,664.00 + 22% 40,525 172,750 329,850 29,502.00 + 24% 172,750 86,375 164,925 14,751.00 + 24% 86,375 329,850 418,850 67,206.00 + 32% 329,850 164,925 209,425 33,603.00 + 32% 164,925 418,850 628,300 95,686.00 + 35% 418,850 209,425 314,150 47,843.00 + 35% 209,425 628,300 168,993.50 + 37% 628,300 314,150 84,496.75 + 37% 314,150Schedule SE Complete Janice Morgan's Schedule SE for 2021. Hint: Compute OASDI and HI separately. If required, round amounts to the nearest dollar. SCHEDULE SE OMB No. 1545-0074 Self-Employment Tax (Form 1040) 2021 Department of the Treasury Go to www.irs.gov/ScheduleSE for instructions and the latest information. Attachment Internal Revenue Service (99) Attach to Form 1040, 1040-SR, or 1040-NR. Sequence No. 17 Name of person with self-employment income (as shown on Form 1040, Social security number of person 1040-SR, or 1040-NR) with self-employment income 123-45-6782 Janice Morgan Part ] f-Employment Tax Note: If your only income subject to self-employment tax is church employee income, see instructions for how to report your income and the definition of church employee income A If you are a minister, member of a religious order, or Christian Science practitioner and you filed Form 4361, but you had $400 or more of other net earnings from self-employment, check here and continue with Part I . . . . . . . . . . . .... Skip lines la and 1b if you use the farm optional method in Part II. See instructions. la Net farm profit or (loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A . . . la b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code AH 1b Skip line 2 if you use the nonfarm optional method in Part II. See instructions. Net profit or (loss) from Schedule C, line 31; and Schedule K-1 (Form 1065), box 14, code A (other than farming). See instructions for other income to report or if you are a minister or member of a religious order 2 O X 3 Combine lines 1a, 1b, and 2 . . . 3 O X 4a If line 3 is more than zero, multiply line 3 by 92.35% (0.9235). Otherwise, enter amount from line 3 . 4a O X Note: If line 4a is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions. b If you elect one or both of the optional methods, enter the total of lines 15 and 17 here . . . 4h Combine lines 4a and 4b. If less than $400, stop; you don't owe self-employment tax. Exception: If less than $400 and you had church employee income, enter -0- and continue . 4c O X a Enter your church employee income from Form W-2. See instructions for definition of church employee income . . . . . . 5 a b Multiply line 5a by 92.35% (0.9235). If less than $100, enter -0- . . . . . 5b O V 6 Add lines 4c and 5b . . . . O X 7 Maximum amount of combined wages and self-employment earnings subject to social security tax or the 6.2% portion of the 7.65% railroad retirement (tier 1) tax for 2021 . 7 O X a Total social security wages and tips (total of boxes 3 and 7 on Form(s) W-2) andSchedule SE definition of church employee income . . . . . . . . . . . . . . . . . . . . . .. 5a b Multiply line 5a by 92.35% (0.9235). If less than $100, enter -0- 5b O V 5 Add lines 4c and 5b . . . . 6 O X 7 Maximum amount of combined wages and self-employment earnings subject to social security tax or the 6.2% portion of the 7.65% railroad retirement (tier 1) tax for 2021 . . O X Ba Total social security wages and tips (total of boxes 3 and 7 on Form(s) W-2) and railroad retirement (tier 1) compensation. If $142,800 or more, skip lines sb through 10, and go to line 11 . Ba 6 Unreported tips subject to social security tax from Form 4137, line 10 . . . . . . . . 8b C Wages subject to social security tax from Form 8919, line 10 . . . 8c d Add lines 8a, 8b, and 8c . . . 8d 9 Subtract line 8d from line 7. If zero or less, enter -0- here and on line 10 and go to line 11 O X 10 Multiply the smaller of line 6 or line 9 by 12.4% (0.124) . . . 10 O X 11 Multiply line 6 by 2.9% (0.029) 11 O X 12 Self-employment tax. Add lines 10 and 11. Enter here and on Schedule 2 (Form 1040), line 4 . . . . . . 12 O X 13 Deduction for one-half of self-employment tax. Multiply line 12 by 50% (0.50). Enter here and on Schedule 1 (Form 1040), line 13 O X Part II Optional Methods To Figure Net Earnings (see instructions) Farm Optional Method. You may use this method only if (a) your gross farm incomes wasn't more than $8,820, or (b) your net farm profits ?) were less than $6,367. 14 Maximum income for optional methods . 14 O X 15 Enter the smaller of: two-thirds (2/3) of gross farm income' (not less than zero) or $5,880. Also, include this amount on line 4b above . . . . . . 15 Nonfarm Optional Method. You may use this method only if (a) your net nonfarm profits ) were less than $6,367 and also less than 72.189% of your gross nonfarm income, "* and (b) you had net earnings from self- employment of at least $400 in 2 of the prior 3 years. Caution: You may use this method no more than five times. 16 Subtract line 15 from line 14 . . . . 16 17 Enter the smaller of: two-thirds (2/3) of gross nonfarm income ) (not less than zero) or the amount on line 16. Also, include this amount on line 4b above . . . . . 17 (1) From Sch. F, line 9; and Sch. K-1 (Form 1065), box 14, code B. () From Sch. C, line 31; and Sch. K-1 (Form 1065), box 14, code A. (2) From Sch. F, line 34; and Sch. K-1 (Form 1065), box 14, code A (4) From Sch. C, line 7; and Sch. K-1 (Form 1065), box 14, code C. -minus the amount you would have entered on line 1b had you not used the optional method. BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule SE (Form 1040) 2021Form 8995 Complete Janice's Form 8995 for 2021. Qualified Business Income Deduction OMB No. 1545-2294 Form 8995 Simplified Computation 2021 Department of the Treasury Attach to your tax return. Attachment Internal Revenue Service Go to www.irs.gov/Form8995 for instructions and the latest information. Sequence No. 55 Name(s) shown on return Your taxpayer identification number Janice Morgan 123-45-6782 Note. You can claim the qualified business income deduction only if you have qualified business income from a qualified trade or business, real estate investment trust dividends, publicly traded partnership income, or a domestic production activities deduction passed through from an agricultural or horticultural cooperative. See instructions. Use this form if your taxable income, before your qualified business income deduction, is at or below $164,900 ($164,925 if married filing separately; $329,800 if married filing jointly), and you aren't a patron of an agricultural or horticultural cooperative. (b) Taxpayer (c) Qualified business (a) Trade, business, or aggregation name identification number income or (loss) Writers Anonymous 123-45-6782 O X ii iv 2 Total qualified business income or (loss). Combine lines li through 1v, column (c). 2 O X 3 Qualified business net (loss) carryforward from the prior year . . . . . . . 3 O V 4 Total qualified business income. Combine lines 2 and 3. If zero or less, enter -0- O X 5 Qualified business income component. Multiply line 4 by 20% (0.20) . . . . . . 5 O X 6 Qualified REIT dividends and publicly traded partnership (PTP) income or (loss) (see instructions) . . . 0 . . . .. 7 Qualified REIT dividends and qualified PTP (loss) carryforward from the prior year. 7 O V 8 Total qualified REIT dividends and PTP income. Combine lines 6 and 7. If zero or less, enter -0- . . 8 O V 9 REIT and PTP component. Multiply line 8 by 20% (0.20) . . . . 0 10 Qualified business income deduction before the income limitation. Add lines 5 and 9 10 O X 11 Taxable income before qualified business income deduction (see instructions) . . . . 11 O X 12 Net capital gain (see instructions) . . . . . . . . . . .. 12 O V 13 Subtract line 12 from line 11. If zero or less, enter -0-. 13 O X13 Subtract line 12 from line 11. If zero or less, enter -0- . . 13 0 X 14 Income limitation. Multiply line 13 by 20% (0.20) . . . . . 14 0 X 15 Qualified business income deduction. Enter the smaller of line 10 or line 14. Also enter this amount on the applicable line of your return (see instructions) . . . . . 15 0 X 16 Total qualified business (loss) carryforward. Combine lines 2 and 3. If greater than zero, enter -0- . . . . 16 0 17 Total qualified REIT dividends and PTP (loss) carryforward. Combine lines 6 and 7. If greater than zero, enter -0- . 17 BAA For Privacy Act and Paperwork Reduction Act Notice, see instructions. Form 8995 (2021) Feedback Check My Work Partially correctForm 4562 Complete Janice's Form 4562 for 2021. Assume additional first-year depreciation is not elected. Click here to access the depreciation table to use for this problem. For 2021, the maximum 5 179 expense deduction is $1,050,000 and the cost of $ 179 property placed in service during the tax year may not exceed $2,620,000. OMB No. 1545-0172 Form 4562 Depreciation and Amortization (Including Information on Listed Property) 2021 Department of the Treasury Attach to your tax return. Attachment Internal Revenue Service (99) Go to www.irs.gov/Form4562 for instructions and the latest information. Sequence No. Name(s) shown on return Identifying number Janice Morgan 123-45-6782 Business or activity to which this form relates Schedule C - Writers Anonymous Part I Election To Expense Certain Property Under Section 179 Note: If you have any listed property, complete Part V before you complete Part I. Maximum amount (see instructions) . O X 2 Total cost of section 179 property placed in service (see instructions) . . . . . . . . . . . . . . . . . . . . . . . O X 3 - Threshold cost of section 179 property before reduction in limitation (see instructions) . . . . . . . . . . . . . . . 3 O X Reduction in limitation. Subtract line 3 from line 2. If zero or less, enter -0- . . . . . . 4 4 O V 5 Dollar limitation for tax year. Subtract line 4 from line 1. If zero or less, enter -0-. If married filing separately, see instructions . . . . 5 O X (b) Cost (business use (a) Description of property (c) Elected cost only) Furniture & fixtures O X O X Computer Equipment O X O X 7 Listed property. Enter the amount from line 29 . . . . . 7 O V Total elected cost of section 179 property. Add amounts in column (c), lines 6 and 7. . . . . . . . . . . . . . . . .. 8 O X Tentative deduction. Enter the smaller of line 5 or line 8 . . . . 9 O X 10 Carryover of disallowed deduction from line 13 of your 2020 Form 4562 . . . . . . . . . . . . . . . . . . . . . . . . . . 10 O V 11 Business income limitation. Enter the smaller of business income (not less than zero) or line 5. See instrs. 11 O X 12 Section 179 expense deduction. Add lines 9 and 10, but don't enter more than line 11 . 12 O X Carryover of disallowed deduction to 2022. Add lines 9 and 10, less line 12 . 13 13Form 4562 X 13 Carryover of disallowed deduction to 2022. Add lines 9 and 10, less line 12 . 13 0 Note: Don't use Part II or Part III below for listed property. Instead, use Part V. Part II Special Depreciation Allowance and Other Depreciation (Don't include listed property. See instructions.) 14 Special depreciation allowance for qualified property (other than listed property) placed in service during the tax year. See instructions . 14 15 Property subject to section 168(f)(1) election . . 15 16 Other depreciation (including ACRS) . . 16 Part III MACRS Depreciation (Don't include listed property. See instructions. Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2021 . . . . . . . 17 18 If you are electing to group any assets placed in service during the tax year into one or more general asset accounts, check here . . . . . . . Section B - Assets Placed in Service During 2021 Tax Year Using the General Depreciation System (c) Basis for (b) Month and depreciation (a) Classification of year placed in (business/investment (d) Recovery (e) Convention (f) Method (9) Depreci property period deductic service use only - see instructions) a 3-year property b 5-year property c 7-year property 10-year property e 15-year property 20-year property g 25-year property 25 yrs S/L h Residential rental 27.5 yrs MM 5/L property 27.5 yrs MM S/L Nonresidential real 39 yrs MM 5/L property MM S/L Section C - Assets Placed in Service During 2021 Tax Year Using the Alternative Depreciation System 20a Class life S/L b 12-year 12 yrs S/L c 30-year 30 yrs MM S/L 1 40-year 40 yrs MM S/L Part IV Summary (See instructions.) Listed property. Enter amount from line 28 . . . . .Section B - Assets Placed in Service During 2021 Tax Year Using the General Depreciation System (c) Basis for (b) Month and depreciation (a) Classification of (d) Recovery (g) Depreciation year placed in (business/investment (e) Convention (f) Method property period deduction service use only - see instructions 19a 3-year property 6 5-year property c 7-year property d 10-year property e 15-year property f 20-year property g 25-year property 25 yrs S/L h Residential rental 27.5 yrs MM S/L property 27.5 yrs MM S/L i Nonresidential real 39 yrs MM S/L property MM S/L Section C - Assets Placed in Service During 2021 Tax Year Using the Alternative Depreciation System 20a Class life S/L b 12-year 12 yrs S/L C 30-year 30 yrs MM S/L 1 40-year 40 yrs MM S/L Part IV Summary (See instructions.) Listed property. Enter amount from line 28 . . . . 21 21 22 Total. Add amounts from line 12, lines 14 through 17, lines 19 and 20 in column (9), and line 21. Enter here and on the appropriate lines of your return. Partnerships and S corporations - see instructions . . . . . . . . . . 22 O X 23 For assets shown above and placed in service during the current year, enter the portion of the basis attributable to section 263A costs . . 23 BAA For Paperwork Reduction Act Notice, see separate instructions. Form 4562 (2021)