File tax return:

Please help me complete form 8582 Passive Activity Loss Limitations using the following given client information.

1. Jeff R. and Dawn N. Brown (ages 48 and 47) are married and live at 1350 Walnut Lane, San Diego, CA 92101. Jeff is a consultant and Dawn is a high school teacher. They file a joint return and use the cash basis for tax purposes. Jeffs Social Security number is 111-11-1121 and Dawns is123-45-6748.

2. The Browns provide over half of the support of their two children, Sophie (born January 25, 2007, Social Security number 123-45-6788) and Luke (born February 7, 2011, Social Security number 123-45-6780).

3. Dawn spent $437 in unreimbursed expenses related to her teaching job.

4. The Browns earned interest income as follows:

- Bank of America savings account $135

- State of California general obligation bond $300

5. The Browns own Prudential Financial Inc. stock for which they received $400 in qualified dividends.

6. The Browns have a short-term capital loss carryover from 2021 in the amount of $7,700.

7. Dawn has a Form W-2 reporting wages of $57,000, federal income tax withholding of $6,000, and state income tax withholding of $2,000.

8. The Browns filed federal Form 4868 (Application for Automatic Extension of Time to File Individual Income Tax Return) and included a payment of $1,700.

9. Jeff operates a consulting business through which he advises clients on mining engineering. He reports his business income and expenses on Schedule C. Jeffs business activity code is 541990. He has no employees, so he does not have an Employer ID number. The business name is Brown Consulting.

Jeff had the following income and expenses from his consulting business in 2022:

Gross receipts $ 92,800

Advertising expense 3,289

Insurance (business) 1,456

Interest on equipment loan 4,733

Legal expense 6,632

Office expense 1,811

Taxes and licenses 499

Travel 1,350

Self-employed health insurance premiums 4,500

10. Jeff operates his consulting business out of an office in his home that measures 24 feet by 25 feet. The total living space in the home is 3,000 square feet. The cost basis of the home was $400,000 ($50,000 of which was allocated to the land). The fair market value of the home is $800,000.The Browns moved into the home in autumn of 2014, and Jeff immediately set up his home office. Jeff depreciates the business use of his home using MACRS. The furniture and equipment associated with the business are fully depreciated. Additional 2022 costs related to the home are as follows: Utilities $4,800 Repairs and maintenance 2,900 Property/casualty insurance 2,300 Property taxes 4,500 Mortgage interest 9,700

11. Jeff made federal quarterly estimated payments totaling $10,000. He made $2,500 in state income tax estimated payments.

12. On April 1, 2022, the Browns purchased rental property at 5307 Lilac Court, San Diego, CA 92109. The purchase price was $700,000 and $100,000 was allocated to the land. The property was rented immediately. Under the current lease agreement, the property rents for $2,100 a month. Rent is due the first day of each month. Utilities are paid by the tenants. Information regarding the property for 2022 appears below. Rent received $18,900 Property/casualty insurance premiums paid 3,100 Mortgage interest 13,500 Property taxes paid 2,400 Yard maintenance paid 1,200 Repairs 800 The Browns use MACRS to depreciate the rental home and are active participants in the rental activity.

13. The Browns had the following medical expenses for 2022: Doctor bills $7,600 Prescription medicines 900 Hospital expenses 3,500

14. The Browns contributed $5,000 to Lowell Presbyterian Church and gave used clothing (cost of $1,200 and fair market value of $350) to the Salvation Army. All donations are supported by receipts, and the clothing is in very good condition.

15. The Browns paid $750 in state personal property taxes to the DMV.