Question: I need help preparing a 1040 tax return and any necessary schedules with the following information provided. Relevant Client Information: Social Security Numbers: Joe: 123-45-6789

I need help preparing a 1040 tax return and any necessary schedules with the following information provided.

Relevant Client Information:

Social Security Numbers:

  • Joe: 123-45-6789
  • Jill: 333-222-111
  • Hunter (son): 555-77-6666

Ages:

  • Joe: 73
  • Jill: 69
  • Hunter: 11

Jill paid $7,000 in childcare expenses for Hunter while she worked.

Salaries:

  • Joe: $35,000
  • Jill: $30,000
  • Hunter: $600

Interest & Dividends:

  • Interest from Mellon Bank: $6,000
  • Interest on Delaware municipal bonds: $4,000
  • Dividends on Microsoft, Inc. stock: $2,000

Sold 1,000 shares of IBM stock for $6,000 on January 15, 2021. Shares were purchased on January 15, 2014, for $3,000.

Real Estate:

  • Joe and Jill rented out the old family home in Delaware for the entire year.
    • Rental income: $9,000
    • Mortgage interest: $4,000
  • Depreciation: The house was purchased on 12/01/19 at a cost of $100,000 and has depreciated on a straight-line basis over 27.5 years. Accumulated Depreciation from prior years was $3,788.
  • Mortgage interest on the white house owned by Joe and lived in by family: $8,000
  • Real estate taxes on the white house: $8,000.

Taxes Paid:

  • State income taxes withheld from Joes wages: $6,000
  • Federal income taxes withheld from Joes wages: $4,000
  • Delaware City sales tax paid by Joe: $1,800.
  • State income tax refund of 2020 overpayment received in 2021: $2,000 (2020 state income taxes were fully deductible on the 2020 tax return)

Miscellaneous:

  • Joe had $5,000 of business travel expenses, which were reimbursed by his employer.
  • Joe contributed $6,000 to Syracuse University, and $7,000 to Delaware University during the year.
  • Jill paid $4,000 of student loan interest.

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