Question: Explain how much the total tax is and how much the tax can be reduced with citations of the tax code. You have a client

Explain how much the total tax is and how much the tax can be reduced with citations of the tax code.

You have a client (Fred Cheng), who has been working with you for many years. He makes a lot of money, is single, but after a lot of moving around, he decides he wants to purchase a home. He has no real financial assets other than the following (respective values are at the end of the previous month:

• Current Employer 401(k): $250,000

• Previous Employer 401(k): $300,000

• Tax Deferred IRA: $5000

• ROTH IRA: $25,000

• Savings account: $5,000

The home he wants to purchase is on the river and located in Jacksonville, FL and the estimated purchase price is going to be $225,000. Of which, he needs to get 20% down.

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