GERALD AND MOIRA RYAN 1.0 INTRODUCTION: INDIVIDUAL FEDERAL INCOME TAX RETURN 2016 ANNUAL EDITION ALL DATES...

  

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GERALD AND MOIRA RYAN 1.0 INTRODUCTION: INDIVIDUAL FEDERAL INCOME TAX RETURN 2016 ANNUAL EDITION ALL DATES RELATE TO YEAR 2016 UNLESS STATED OTHERWISE You have been employed to complete the Federal income tax return of Gerald and Moira Ryan for 2016. The Ryans have provided you with original copies of all third party documents filed with the IRS, such as W-2's, 1099's, and K-1's. They have also provided you with adequate written documentation to substantiate all transactions mentioned in this case. Lastly, they have provided you with copies of their 2015 Federal and Kansas income tax returns. 1.1 Taxpayer Biographical Information: Biographical data relating to the Ryans are as follows: Gerald Padraig Ryan, SSN 499-45-4939. Born March 17, 1954. Employed as a freight railroad conductor by BNSF Corporation prior to his retirement on October 31. Moira Sullivan Ryan, SSN 455-49-9090. Born January 29, 1963. Sole owner and full- time manager of Moira's Horticultural Creations, an unincorporated florist shop operating in Newton, Kansas. They have been married for 24 years. They reside at 501 Main Street, Newton, Kansas 67114. Their daytime telephone number is (316) 555-1776. 1.2 Persons Supported by the Ryans: The Ryans have the following single children: Michael John Ryan, SSN 455-40-1000. Born August 2, 1995. Full-time student at Creighton University, Omaha, Nebraska before graduating in May. Matriculated as a full-time medical student at St. Louis University in St. Louis, Missouri since August. Of his total support, the Ryans provided 45 percent, Michael provided 40 percent and the balance came from other sources. Michael's sole income consisted of wages and tips aggregating $3,800 earned as a waiter. He lived with the Ryans during the summer months only. Kelly Marie Ryan, SSN 455-30-8220. Born June 2, 1997. Part-time student at Christendom College in Fort Royal, Virginia. The Ryans provided 70 percent of her support. Her income consisted solely of $8,000 earned from a part-time job as a computer analyst. She did not live with the Ryans for any part of 2016. Oliver Plunkett Ryan, SSN 455-30-3030. Born December 12, 2001. Full-time student at St. Michael's Catholic High School. The Ryans provided 100 percent of his support. He earned no income. He lived with the Ryans throughout the entire year. The Ryans also supported the following persons: ● ● 1.3 Taxpayer Filing Information: The following tax filing information relates to the Ryans: The Ryans wish to file as married filing jointly on their 2016 Federal income tax return. Neither Gerald nor Moira wish to contribute to the Presidential Election Campaign Fund. ● ● ● 1.4 Jane O'Dea Sullivan, mother of Moira, SSN 252-45-5059. Widow. Born February 7, 1934. Resided in Benson, Arizona prior to her death on November 3. The Ryans provided 65 percent of her total support. Her sole income consisted of $1,100 of interest and dividends and $5,600 of Social Security benefits. Both Gerald and Moira desire that any tax overpayment be refunded rather than credited to their 2017 Federal tax return. Data Relating to 2014 Federal and Kansas Income Tax Returns: The following data were reported on the 2015 Federal and Kansas income tax returns filed by the Ryans: ● John Wilson Amner, cousin of Gerald, SSN 780-45-6700. Widower. Born January 19, 1955. Resides in Arkansas City, Kansas. The Ryans provided 60 percent of his total support. His sole income consisted of $8,800 of disability income paid by the State of Kansas. ● The Ryans are calendar year taxpayers. The Ryans follow the cash receipts method except that Moira's Horticultural Creations accounts for sales, inventory purchases, and cost of goods sold on the accrual basis. The Ryans filed as married filing jointly on their 2015 Federal and Kansas income tax returns. The Ryans reported a tax liability of $13,400 on their 2015 Federal income tax return. They received a check in the amount of $2,560 from the U.S. Treasury as a refund on their Federal return on July 17. ● 2.0 2.2 The Ryans reported a tax liability of $3,486 in their 2015 Kansas income tax return. They received a check in the amount of $710 from the Kansas Department of Revenue as a refund on their 2015 Kansas tax return on June 19. The Ryans did deduct all Kansas income taxes on Schedule A on their 2015 Federal income tax return. 2.1 Salary Income: As stated in Section 1.1 above, Gerald was employed as a freight train railroad conductor by BNSF Corporation prior to his retirement on October 31. His Form W-2 as filed by BNSF Corporation is attached. (BNSF Corporation operates the Burlington Northern Santa Fe Railway.) ● The Ryans reported a net short-term capital loss carryforward of $1,250 on their 2015 Federal tax return. The Ryans reported no other carryforwards on their 2015 Federal income tax return. ● INCOME SOURCES Gerald received the following retirement income: Retirement Income: Monthly Railroad Retirement benefits. His Form RRB-1099 as filed by the Social Security Administration is attached. Distributions from a profit-sharing pension plan he participated in as an employee of BNSF Corporation. His Form 1099-R as filed by the First Bank of Albuquerque, the Trustee of the pension fund, is attached. Distributions from an annuity paid by Aeterna Insurance. His Form 1099-R as filed By Aeterna is attached. He began receiving this annuity on July 1. He purchased the Annuity from Aeterna Insurance in 1998 for $26,000. A lump-sum distribution from a traditional IRA plan. His Form 1099-R as filed by The First National Bank in St. Louis is attached. Gerald owns no other retirement or deferred compensation account. b Employer identification number (EIN) 76-1305034 c Employer's name, address, and ZIP code d Control number BNSF 1501 JAMES ST FORT WORTH, TX 76102 e Employee's first name and initial a Employee's social security number 499-45-4939 GERALD P RYAN 501 E MAIN ST NEWTON, KS 67114 KS f Employee's address and ZIP code 15 State Employer's state ID number 10-4938 Last name Form W-2 Wage and Tax Statement OMB No. 1545-0008 Copy B-To Be Filed With Employee's FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service. IRS 1 Wages, tips, other compensation 41000.00 2016 3 Social security wages Safe, accurate, FAST! Use 5 Medicare wages and tips 9 7 Social security tips 16 State wages, tips, etc. 17 State income tax 41000.00 Suff. 11 Nonqualified plans 13 Statutory employee 41000.00 14 Other 1230.00 41000.00 Retirement plan Third-party sick pay 18 Local wages, tips, etc. file 2 Federal income tax withheld 7380.00 Visit the IRS website at www.irs.gov/efile 4 Social security tax withheld 2542.00 6 Medicare tax withheld 8 Allocated tips 10 Dependent care benefits 12c 12a See instructions for box 12 d 12b 12d 595.00 19 Local income tax 20 Locality name Department of the Treasury-Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code AETERNA INSURANCE 1003 S. 9th ST OMAHA, NEBRASKA 68108 PAYER'S federal identification number 76-4958112 RECIPIENT'S name $ Account number (see instructions) Form 1099-R CORRECTED (if checked) 1 Gross distribution RECIPIENT'S identification number 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r 948.00 $ 2b Taxable amount $ 3 Capital gain (included in box 2a) 5 not determined X 7 Distribution code(s) OMB No. 1545-0119 GERALD P RYAN Street address (including apt. no.) 501 MAIN ST 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 10 Amount allocable to IRR 13 State/Payer's state no. 14 State distribution within 5 years $ $ 17 Local distribution IRA/ SEP/ SIMPLE FATCA filing 12 requirement $ $ 15 Local tax withheld $ $ 2016 $ Employee contributions 6 /Designated Roth contributions or insurance premiums Form 1099-R Total distribution 4 Federal income tax withheld Net unrealized appreciation in employer's securities Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. 8 Other 16 Name of locality % This information is being furnished to the Internal Revenue Service. $ $ Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code FIRST NATIONAL BANK 555 16th ST ST LOUIS, MO 63103 PAYER'S federal identification number 74-8956334 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST $ Account number (see instructions) RECIPIENT'S identification number Form 1099-R CORRECTED (if checked) 1 Gross distribution 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r $ 2b Taxable amount $ 3 Capital gain (included in box 2a) 5 1700.00 $ 7 not determined X $ $ Distribution code(s) FATCA filing 12 requirement $ $ 15 Local tax withheld IRA/ SEP/ SIMPLE X OMB No. 1545-0119 $ Employee contributions 6 /Designated Roth contributions or insurance premiums 2016 Form 1099-R $ 4 Federal income tax withheld 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 10 Amount allocable to IRR within 5 years Total distribution X Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. Net unrealized appreciation in employer's securities 8 Other 16 Name of locality % 13 State/Payer's state no. This information is being furnished to the Internal Revenue Service. 14 State distribution $ $ 17 Local distribution $ $ Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code FIRST BANK OF ALBUQUERQUE 214 FIRST ST SW ALBUQUERQUE, NM 87102 PAYER'S federal identification number 76-2948572 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST 10 Amount allocable to IRR within 5 years $ Account number (see instructions) CORRECTED (if checked) 1 Gross distribution Form 1099-R RECIPIENT'S identification number 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r $ 2b Taxable amount $ 1920.00 3 Capital gain (included in box 2a) 5 $ 7 not determined X Employee contributions /Designated Roth contributions or insurance premiums Distribution code(s) IRA/ SEP/ SIMPLE FATCA filing 12 requirement $ $ 15 Local tax withheld $ $ OMB No. 1545-0119 $ 2016 Total distribution 4 Federal income tax withheld Form 1099-R $ 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 6 Net unrealized appreciation in employer's securities 8 Other Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. 16 Name of locality % 13 State/Payer's state no. This information is being furnished to the Internal Revenue Service. 14 State distribution $ $ 17 Local distribution $ Department of the Treasury - Internal Revenue Service UNFOLD TO SEE ALL TAX STATEMENT FORMS - SEE REVERSE SIDE FOR GENERAL INFORMATION 2016 PAYER'S NAME. STREET ADDRESS, CITY, STATE, AND ZIP CODE UNITED STATES RAILROAD RETIREMENT BOARD 844 N RUSH ST CHICAGO IL 60611-1275 PAYER'S FEDERAL IDENTIFYING NO. 36-3314600 1. Claim Number and Payee Code 2. Recipient's Identification Number 499-45-4939 Recipient's Name, Street Address, City, State, and Zip Code GERALD P RYAN 501 MAIN ST NEWTON, KS 67114 FORM RRB-1099 i 3. Gross Social Security Equivalent Benefit Portion of Tier 1 Paid in 2016 4. Social Security Equivalent Benefit Portion of Tier 1 Repaid to RRB 2016 2026.00 5. Net Social Security Equivalent Benefit Portion of Tier 1 Paid in 2016 6. Workers' Compensation Offset in 2016 7. Social Security Equivalent Benefit Portion of Tier 1 Paid for 200526.00 8. Social Security Equivalent Benefit Portion of Tier 1 Paid for 2014 9. Social Security Equivalent Benefit Portion of Tier 1 Paid for Years Prior to 2014 10. Federal Income Tax Withheld PAYMENTS BY THE RAILROAD RETIREMENT BOARD 11. Medicare Premium Total COPY C- FOR RECIPENT'S RECORDS. THIS INFORMATION IS BEING FURNISHED TO THE INTERNAL REVENUE SERVICE. DO NOT ATTACH TO YOUR INCOME TAX RETURN 2.3 Income from Trade of Business: A. As stated in Section 1.1 above, Moira was sole owner and manager of Moira's Horticultural Creations, an unincorporated floral shop. The shop is located at 1234 Utah Street, Newton, Kansas 67114. She accounts for all transactions on the cash receipts method except that sales, inventory purchases, and cost of goods sold are accounted for on the accrual basis. She also accounts for inventory on a lower of cost or market basis. She is at-risk for all losses. Her Employer Identification Number (EIN) is 86-3548975. The applicable business code is 453110. B. The following cash receipts were posted to the general account: D. ● C. The Following cash payments were posted to the general cash account: ● Purchase of cut flowers for resale ● Purchase of potted plants for resale Supplies Utilities Rent $143,000 395,900 Of all credit sales in 2016, $1,045 proved uncollectible as of the end of 2016. ● Cash sales Credit sales ● Payment of business loan Interest on business loan Insurance Accounting and tax preparation services Advertising ● Automotive expenses ● Repairs ● Contribution to Moira's Keough plan ● Entertainment expenses ● ● Meals ● State licensing fee (including fine of $125 for late payment) The following cash payments were posted to the payroll account: Gross employee wages FICA (employer portion) Medicare taxes (employer portion) $101,580 100,820 22,500 12,000 20,000 44,000 7,600 6,500 1,800 6,700 2,000 1,000 4,000 1,600 700 ● Federal unemployment tax ● State unemployment tax 575 73,000 4,658 1,270 820 290 E. Moira's Horticultural Creations had no unpaid expenses as of December 31, 2016. F. Beginning and ending inventory balances are summarized as follows: Category Cut flowers Potted plants Description of Property: Horticultural Structure Computer System Office Furniture G. During 2016 Moira's Horticultural Creations purchased and placed into service the following assets: Beginning Balance Description of Property: $2,000 3,500 Computer system Computer printer Office furniture Cutting equipment Date Placed into Service: 8/19/16 9/15/16 2/22/16 Ending Balance Date Placed into Service: 9/26/13 10/14/13 4/04/14 7/08/15 Purchase Price: $80,000 $9,000 4,400 27,000 30,000 Section 179 election was claimed on the Horticultural Structure and the Computer System but only 50% on the Office Furniture. H. Depreciable property that Moira's Horticultural Creations purchased and placed into service prior to 2015 consisted of the following: Business Use: Adjusted Basis when Placed into Service: $6,600 1,780 29,300 3,000 100% 100% 100% Business Use: 100% 100% 100% 100% 1. Moira's Horticultural Creations also operates a delivery van that it placed into service on April 16, 2014. Automotive use consisted exclusively of the use of the delivery van. The van was driven a total of 12,000 miles in 2016. Moira's Horticultural Creations has a written policy prohibiting the personal use of business-owned vehicles. Written documentation also exists justifying business use of all business-owned vehicles. Moira's Horticultural Creations has always used the automatic mileage method. Business use has always been 100 percent. 2.4 Dividends Received: The Ryans received the following cash dividends or corporate distributions from each source as indicated: A. The Ryans hold interests in several mutual funds through their account with the stock brokerage firm of Joseph Schwartz and Associates. Their substitute Form 1099-DIV as filed by Joseph Schwartz is attached. ● The Ryans owned 1,200 shares of stock in First National Bank of Newton as of December 31, 2010. Their substitute Form 1099-DIV as filed by First National Bank of Newton is attached. 2.5 Interest Received: The Ryans received a Form 1099-INT as filed by each of the following sources: O O First National Bank of Newton Central Kansas Savings and Loan Each Form 1099-INT is attached. B. The annual statement from Joseph Schwartz, as mentioned in Section 2.4 above lists interest of $500 on Kansas General Obligation Bonds. Schwartz was not required to report this amount on the substitute Form 1099-DIV that it filed with the IRS. PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. JOSEPH SCHWARTZ & ASSOC 225 S CANAL ST CHICAGO, IL 80661 PAYER'S federal identification number RECIPIENT'S identification number 74-1121134 RECIPIENT'S name Account number (see instructions) CORRECTED (if checked) 499-45-4939 GERALD P RYAN Street address (including apt. no.) 501 MAIN ST City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Form 1099-DIV (keep for your records) 1a Total ordinary dividends 4000.00 $ 1b Qualified dividends $ 3200.00 2a Total capital gain distr. $ 7000.00 2c Section 1202 gain $ 3 Nondividend distributions $ 6 Foreign tax paid $ 8 Cash liquidation distributions $ FATCA filing 10 Exempt-interest dividends requirement ■ OMB No. 1545-0110 www.irs.gov/form1099div 2016 Form 1099-DIV 2b Unrecap. Sec. 1250 gain $ 2d Collectibles (28%) gain $ 4 Federal income tax withheld $ 5 Investment expenses $ 7 Foreign country or U.S. possession 9 Noncash liquidation distributions $ 11 Specified private activity bond interest dividends $ $ 12 State 13 State identification no 14 State tax withheld $ Dividends and Distributions Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service CORRECTED (if checked) PAYER'S name, street address, city or town, state or province, country, ZIP 1a Total ordinary dividends or foreign postal code, and telephone no. FIRST NATIONAL BANK OF NEWTON 1600 KANSAS ST NEWTON, KS 67114 PAYER'S federal identification number RECIPIENT'S identification number 76-3357980 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Account number (see instructions) 499-45-4939 Form 1099-DIV (keep for your records) $ 1b Qualified dividends 1300.00 $ 1300.00 2a Total capital gain distr. $ 2c Section 1202 gain $ 3 Nondividend distributions $ 6 Foreign tax paid OMB No. 1545-0110 www.irs.gov/form1099div 2016 Form 1099-DIV 2b Unrecap. Sec. 1250 gain $ 2d Collectibles (28%) gain $ 4 Federal income tax withheld $ 5 Investment expenses $ 7 Foreign country or U.S. possession $ 8 Cash liquidation distributions 9 Noncash liquidation distributions $ $ FATCA filing 10 Exempt-interest dividends requirement ☐ 11 Specified private activity bond interest dividends $ $ 12 State 13 State identification nol 14 State tax withheld $ Dividends and Distributions Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. FIRST NATIONAL BANK OF NEWTON 1600 KANSAS ST NEWTON, KS 67114 PAYER'S federal identification number RECIPIENT'S identification number 76-3357980 499-45-4939 RECIPIENT'S name GERALD & MOIRA RYAN Street address (including apt, no.) 501 MAIN ST CORRECTED (if checked) Payer's RTN (optional) City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Account number (see instructions) Form 1099-INT (keep for your records) 1 Interest income $ 3200.00 2 Early withdrawal penalty 6 Foreign tax paid $ 8 Tax-exempt interest $ 3 Interest on U.S. Savings Bonds and Treas, obligations $ 10 Market discount OMB No. 1545-0112 $ 4 Federal income tax withheld 5 Investment expenses I$ $ 7 Foreign country or U.S. possession 2016 14 Tax-exempt and tax credit bond CUSIP no. Form 1099-INT www.irs.gov/form1099int 9 Specified private activity bond interest $ 11 Bond premium Interest Income Copy B For Recipient $ FATCA filing $ requirement 12 Bond premium on Treasury obligations 13 Bond premium on tax-exempt bond $ $ 15 State 16 State identification no. 17 State tax withheld This is important tax information and is being furnished to the Internal Revenue Service. If vice. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. CENTRAL KANSAS SAVINGS & LOAN 5th AND HOLLIDAY SIS TOPEKA, KS 66607 PAYER'S federal identification number RECIPIENT'S identification number 76-7893456 RECIPIENT'S name MOIRA RYAN Street address (including apt. no.) 501 MAIN ST Account number (see instructions) CORRECTED (if checked) Payer's RTN (optional) 455-49-9090 City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Form 1099-INT (keep for your records) 1 Interest income $ 4700.00 2 Early withdrawal penalty 6 Foreign tax paid $ 8 Tax-exempt interest 3 Interest on U.S. Savings Bonds and Treas, obligations |$ 10 Market discount OMB No. 1545-0112 $ 4 Federal income tax withheld 5 Investment expenses $ $ 7 Foreign country or U.S. possession 2016 14 Tax-exempt and tax credit bond CUSIP no. Form 1099-INT www.irs.gov/form1099int 9 Specified private activity bond interest $ FATCA filing $ requirement 12 Bond premium on Treasury obligations 13 Bond premium on tax-exempt bond $ $ 15 State 16 State identification no. $ 11 Bond premium Interest Income Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. 17 State tax withheld $ Department of the Treasury - Internal Revenue Service 2.6 Sale of Corporate Stock: The Ryans sold the following shares of common stock in privately held corporations: Date of Sale: Proceeds from Sale: Description Of Stock 1,200 Shares Union Pacific Corp. 200 Shares CSX Corp. 100 Shares Novara Corp. 5,000 Shares Pfau Corp. Date of Acquisition: 3/9/11 12/12/16 3/17/06 5/19/16 11/12/16 12/30/16 $41,000 $10,300 $45,200 4/20/16 6/14/16 $65,000 Method of Acquisition: Purchased by Ryans for $29,000 Received by Moira as gift from sister. Basis to sister at time of gift was $10,800. Received as inheritance from Moira's mother. FMV At time of death Was $44,350.* Purchased by Ryans for $89,000 Method Sale Sold to neighbor Sold to friend Sold to Moira's cousin Sold to Gerald's brother *The executor of Jane Sullivan's estate does not intend to elect the alternate valu ion method. All stocks listed above were held by the Ryans for investment purposes. None was purchased directly from the corporation involved, nor was any held in a brokerage company account. 2.7 Other Income: A. Gerald owns a 20 percent interest in Central Kansas Oilfield, Inc., a subchapter S Corporation. Although Gerald attends annual shareholder meetings, he does not participate in the management or operation of this corporation. His K-1 filed by Central Kansas Oilfield, Inc. is attached. His adjusted basis in his stock in Central Kansas Oilfield, Inc. as of December 31, 2016, was $90,000. Central Kansas Oilfield, Inc. does not have any working interests in any oil and natural gas properties. B. The Ryans received the following: • An inheritance from Moira's mother consisting of the stock in Novara Corporation listed in Section 2.6 above and $55,000 in cash. • A trip to Ireland worth $3,800 as a retirement gift from Gerald's brother, Fred. • Royalty income consisting of $300 paid to Gerald for his autobiographical story entitled "My Life on the Atchison, Topeka and Santa Fe" published in Trains Magazine. The magazine publisher was not required to file a Form 1099-MISC with the IRS. • Gerald was named the "Outstanding Railroader of the Year" by his local of the United Transportation Union. He received a check for $1,000 as part of this award. Moira promptly spent the money. GERALD AND MOIRA RYAN 1.0 INTRODUCTION: INDIVIDUAL FEDERAL INCOME TAX RETURN 2016 ANNUAL EDITION ALL DATES RELATE TO YEAR 2016 UNLESS STATED OTHERWISE You have been employed to complete the Federal income tax return of Gerald and Moira Ryan for 2016. The Ryans have provided you with original copies of all third party documents filed with the IRS, such as W-2's, 1099's, and K-1's. They have also provided you with adequate written documentation to substantiate all transactions mentioned in this case. Lastly, they have provided you with copies of their 2015 Federal and Kansas income tax returns. 1.1 Taxpayer Biographical Information: Biographical data relating to the Ryans are as follows: Gerald Padraig Ryan, SSN 499-45-4939. Born March 17, 1954. Employed as a freight railroad conductor by BNSF Corporation prior to his retirement on October 31. Moira Sullivan Ryan, SSN 455-49-9090. Born January 29, 1963. Sole owner and full- time manager of Moira's Horticultural Creations, an unincorporated florist shop operating in Newton, Kansas. They have been married for 24 years. They reside at 501 Main Street, Newton, Kansas 67114. Their daytime telephone number is (316) 555-1776. 1.2 Persons Supported by the Ryans: The Ryans have the following single children: Michael John Ryan, SSN 455-40-1000. Born August 2, 1995. Full-time student at Creighton University, Omaha, Nebraska before graduating in May. Matriculated as a full-time medical student at St. Louis University in St. Louis, Missouri since August. Of his total support, the Ryans provided 45 percent, Michael provided 40 percent and the balance came from other sources. Michael's sole income consisted of wages and tips aggregating $3,800 earned as a waiter. He lived with the Ryans during the summer months only. Kelly Marie Ryan, SSN 455-30-8220. Born June 2, 1997. Part-time student at Christendom College in Fort Royal, Virginia. The Ryans provided 70 percent of her support. Her income consisted solely of $8,000 earned from a part-time job as a computer analyst. She did not live with the Ryans for any part of 2016. Oliver Plunkett Ryan, SSN 455-30-3030. Born December 12, 2001. Full-time student at St. Michael's Catholic High School. The Ryans provided 100 percent of his support. He earned no income. He lived with the Ryans throughout the entire year. The Ryans also supported the following persons: ● ● 1.3 Taxpayer Filing Information: The following tax filing information relates to the Ryans: The Ryans wish to file as married filing jointly on their 2016 Federal income tax return. Neither Gerald nor Moira wish to contribute to the Presidential Election Campaign Fund. ● ● ● 1.4 Jane O'Dea Sullivan, mother of Moira, SSN 252-45-5059. Widow. Born February 7, 1934. Resided in Benson, Arizona prior to her death on November 3. The Ryans provided 65 percent of her total support. Her sole income consisted of $1,100 of interest and dividends and $5,600 of Social Security benefits. Both Gerald and Moira desire that any tax overpayment be refunded rather than credited to their 2017 Federal tax return. Data Relating to 2014 Federal and Kansas Income Tax Returns: The following data were reported on the 2015 Federal and Kansas income tax returns filed by the Ryans: ● John Wilson Amner, cousin of Gerald, SSN 780-45-6700. Widower. Born January 19, 1955. Resides in Arkansas City, Kansas. The Ryans provided 60 percent of his total support. His sole income consisted of $8,800 of disability income paid by the State of Kansas. ● The Ryans are calendar year taxpayers. The Ryans follow the cash receipts method except that Moira's Horticultural Creations accounts for sales, inventory purchases, and cost of goods sold on the accrual basis. The Ryans filed as married filing jointly on their 2015 Federal and Kansas income tax returns. The Ryans reported a tax liability of $13,400 on their 2015 Federal income tax return. They received a check in the amount of $2,560 from the U.S. Treasury as a refund on their Federal return on July 17. ● 2.0 2.2 The Ryans reported a tax liability of $3,486 in their 2015 Kansas income tax return. They received a check in the amount of $710 from the Kansas Department of Revenue as a refund on their 2015 Kansas tax return on June 19. The Ryans did deduct all Kansas income taxes on Schedule A on their 2015 Federal income tax return. 2.1 Salary Income: As stated in Section 1.1 above, Gerald was employed as a freight train railroad conductor by BNSF Corporation prior to his retirement on October 31. His Form W-2 as filed by BNSF Corporation is attached. (BNSF Corporation operates the Burlington Northern Santa Fe Railway.) ● The Ryans reported a net short-term capital loss carryforward of $1,250 on their 2015 Federal tax return. The Ryans reported no other carryforwards on their 2015 Federal income tax return. ● INCOME SOURCES Gerald received the following retirement income: Retirement Income: Monthly Railroad Retirement benefits. His Form RRB-1099 as filed by the Social Security Administration is attached. Distributions from a profit-sharing pension plan he participated in as an employee of BNSF Corporation. His Form 1099-R as filed by the First Bank of Albuquerque, the Trustee of the pension fund, is attached. Distributions from an annuity paid by Aeterna Insurance. His Form 1099-R as filed By Aeterna is attached. He began receiving this annuity on July 1. He purchased the Annuity from Aeterna Insurance in 1998 for $26,000. A lump-sum distribution from a traditional IRA plan. His Form 1099-R as filed by The First National Bank in St. Louis is attached. Gerald owns no other retirement or deferred compensation account. b Employer identification number (EIN) 76-1305034 c Employer's name, address, and ZIP code d Control number BNSF 1501 JAMES ST FORT WORTH, TX 76102 e Employee's first name and initial a Employee's social security number 499-45-4939 GERALD P RYAN 501 E MAIN ST NEWTON, KS 67114 KS f Employee's address and ZIP code 15 State Employer's state ID number 10-4938 Last name Form W-2 Wage and Tax Statement OMB No. 1545-0008 Copy B-To Be Filed With Employee's FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service. IRS 1 Wages, tips, other compensation 41000.00 2016 3 Social security wages Safe, accurate, FAST! Use 5 Medicare wages and tips 9 7 Social security tips 16 State wages, tips, etc. 17 State income tax 41000.00 Suff. 11 Nonqualified plans 13 Statutory employee 41000.00 14 Other 1230.00 41000.00 Retirement plan Third-party sick pay 18 Local wages, tips, etc. file 2 Federal income tax withheld 7380.00 Visit the IRS website at www.irs.gov/efile 4 Social security tax withheld 2542.00 6 Medicare tax withheld 8 Allocated tips 10 Dependent care benefits 12c 12a See instructions for box 12 d 12b 12d 595.00 19 Local income tax 20 Locality name Department of the Treasury-Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code AETERNA INSURANCE 1003 S. 9th ST OMAHA, NEBRASKA 68108 PAYER'S federal identification number 76-4958112 RECIPIENT'S name $ Account number (see instructions) Form 1099-R CORRECTED (if checked) 1 Gross distribution RECIPIENT'S identification number 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r 948.00 $ 2b Taxable amount $ 3 Capital gain (included in box 2a) 5 not determined X 7 Distribution code(s) OMB No. 1545-0119 GERALD P RYAN Street address (including apt. no.) 501 MAIN ST 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 10 Amount allocable to IRR 13 State/Payer's state no. 14 State distribution within 5 years $ $ 17 Local distribution IRA/ SEP/ SIMPLE FATCA filing 12 requirement $ $ 15 Local tax withheld $ $ 2016 $ Employee contributions 6 /Designated Roth contributions or insurance premiums Form 1099-R Total distribution 4 Federal income tax withheld Net unrealized appreciation in employer's securities Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. 8 Other 16 Name of locality % This information is being furnished to the Internal Revenue Service. $ $ Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code FIRST NATIONAL BANK 555 16th ST ST LOUIS, MO 63103 PAYER'S federal identification number 74-8956334 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST $ Account number (see instructions) RECIPIENT'S identification number Form 1099-R CORRECTED (if checked) 1 Gross distribution 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r $ 2b Taxable amount $ 3 Capital gain (included in box 2a) 5 1700.00 $ 7 not determined X $ $ Distribution code(s) FATCA filing 12 requirement $ $ 15 Local tax withheld IRA/ SEP/ SIMPLE X OMB No. 1545-0119 $ Employee contributions 6 /Designated Roth contributions or insurance premiums 2016 Form 1099-R $ 4 Federal income tax withheld 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 10 Amount allocable to IRR within 5 years Total distribution X Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. Net unrealized appreciation in employer's securities 8 Other 16 Name of locality % 13 State/Payer's state no. This information is being furnished to the Internal Revenue Service. 14 State distribution $ $ 17 Local distribution $ $ Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, and ZIP or foreign postal code FIRST BANK OF ALBUQUERQUE 214 FIRST ST SW ALBUQUERQUE, NM 87102 PAYER'S federal identification number 76-2948572 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST 10 Amount allocable to IRR within 5 years $ Account number (see instructions) CORRECTED (if checked) 1 Gross distribution Form 1099-R RECIPIENT'S identification number 499-45-4939 11 1st year of desig. Roth contrib. $ 2a Taxable amount www.irs.gov/form1099r $ 2b Taxable amount $ 1920.00 3 Capital gain (included in box 2a) 5 $ 7 not determined X Employee contributions /Designated Roth contributions or insurance premiums Distribution code(s) IRA/ SEP/ SIMPLE FATCA filing 12 requirement $ $ 15 Local tax withheld $ $ OMB No. 1545-0119 $ 2016 Total distribution 4 Federal income tax withheld Form 1099-R $ 7 $ City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions NEWTON, KS 67114 % $ distribution State tax withheld 6 Net unrealized appreciation in employer's securities 8 Other Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAS, Insurance Contracts, etc. Copy B Report this income on your federal tax return. If this form shows federal income tax withheld in box 4, attach this copy to your return. 16 Name of locality % 13 State/Payer's state no. This information is being furnished to the Internal Revenue Service. 14 State distribution $ $ 17 Local distribution $ Department of the Treasury - Internal Revenue Service UNFOLD TO SEE ALL TAX STATEMENT FORMS - SEE REVERSE SIDE FOR GENERAL INFORMATION 2016 PAYER'S NAME. STREET ADDRESS, CITY, STATE, AND ZIP CODE UNITED STATES RAILROAD RETIREMENT BOARD 844 N RUSH ST CHICAGO IL 60611-1275 PAYER'S FEDERAL IDENTIFYING NO. 36-3314600 1. Claim Number and Payee Code 2. Recipient's Identification Number 499-45-4939 Recipient's Name, Street Address, City, State, and Zip Code GERALD P RYAN 501 MAIN ST NEWTON, KS 67114 FORM RRB-1099 i 3. Gross Social Security Equivalent Benefit Portion of Tier 1 Paid in 2016 4. Social Security Equivalent Benefit Portion of Tier 1 Repaid to RRB 2016 2026.00 5. Net Social Security Equivalent Benefit Portion of Tier 1 Paid in 2016 6. Workers' Compensation Offset in 2016 7. Social Security Equivalent Benefit Portion of Tier 1 Paid for 200526.00 8. Social Security Equivalent Benefit Portion of Tier 1 Paid for 2014 9. Social Security Equivalent Benefit Portion of Tier 1 Paid for Years Prior to 2014 10. Federal Income Tax Withheld PAYMENTS BY THE RAILROAD RETIREMENT BOARD 11. Medicare Premium Total COPY C- FOR RECIPENT'S RECORDS. THIS INFORMATION IS BEING FURNISHED TO THE INTERNAL REVENUE SERVICE. DO NOT ATTACH TO YOUR INCOME TAX RETURN 2.3 Income from Trade of Business: A. As stated in Section 1.1 above, Moira was sole owner and manager of Moira's Horticultural Creations, an unincorporated floral shop. The shop is located at 1234 Utah Street, Newton, Kansas 67114. She accounts for all transactions on the cash receipts method except that sales, inventory purchases, and cost of goods sold are accounted for on the accrual basis. She also accounts for inventory on a lower of cost or market basis. She is at-risk for all losses. Her Employer Identification Number (EIN) is 86-3548975. The applicable business code is 453110. B. The following cash receipts were posted to the general account: D. ● C. The Following cash payments were posted to the general cash account: ● Purchase of cut flowers for resale ● Purchase of potted plants for resale Supplies Utilities Rent $143,000 395,900 Of all credit sales in 2016, $1,045 proved uncollectible as of the end of 2016. ● Cash sales Credit sales ● Payment of business loan Interest on business loan Insurance Accounting and tax preparation services Advertising ● Automotive expenses ● Repairs ● Contribution to Moira's Keough plan ● Entertainment expenses ● ● Meals ● State licensing fee (including fine of $125 for late payment) The following cash payments were posted to the payroll account: Gross employee wages FICA (employer portion) Medicare taxes (employer portion) $101,580 100,820 22,500 12,000 20,000 44,000 7,600 6,500 1,800 6,700 2,000 1,000 4,000 1,600 700 ● Federal unemployment tax ● State unemployment tax 575 73,000 4,658 1,270 820 290 E. Moira's Horticultural Creations had no unpaid expenses as of December 31, 2016. F. Beginning and ending inventory balances are summarized as follows: Category Cut flowers Potted plants Description of Property: Horticultural Structure Computer System Office Furniture G. During 2016 Moira's Horticultural Creations purchased and placed into service the following assets: Beginning Balance Description of Property: $2,000 3,500 Computer system Computer printer Office furniture Cutting equipment Date Placed into Service: 8/19/16 9/15/16 2/22/16 Ending Balance Date Placed into Service: 9/26/13 10/14/13 4/04/14 7/08/15 Purchase Price: $80,000 $9,000 4,400 27,000 30,000 Section 179 election was claimed on the Horticultural Structure and the Computer System but only 50% on the Office Furniture. H. Depreciable property that Moira's Horticultural Creations purchased and placed into service prior to 2015 consisted of the following: Business Use: Adjusted Basis when Placed into Service: $6,600 1,780 29,300 3,000 100% 100% 100% Business Use: 100% 100% 100% 100% 1. Moira's Horticultural Creations also operates a delivery van that it placed into service on April 16, 2014. Automotive use consisted exclusively of the use of the delivery van. The van was driven a total of 12,000 miles in 2016. Moira's Horticultural Creations has a written policy prohibiting the personal use of business-owned vehicles. Written documentation also exists justifying business use of all business-owned vehicles. Moira's Horticultural Creations has always used the automatic mileage method. Business use has always been 100 percent. 2.4 Dividends Received: The Ryans received the following cash dividends or corporate distributions from each source as indicated: A. The Ryans hold interests in several mutual funds through their account with the stock brokerage firm of Joseph Schwartz and Associates. Their substitute Form 1099-DIV as filed by Joseph Schwartz is attached. ● The Ryans owned 1,200 shares of stock in First National Bank of Newton as of December 31, 2010. Their substitute Form 1099-DIV as filed by First National Bank of Newton is attached. 2.5 Interest Received: The Ryans received a Form 1099-INT as filed by each of the following sources: O O First National Bank of Newton Central Kansas Savings and Loan Each Form 1099-INT is attached. B. The annual statement from Joseph Schwartz, as mentioned in Section 2.4 above lists interest of $500 on Kansas General Obligation Bonds. Schwartz was not required to report this amount on the substitute Form 1099-DIV that it filed with the IRS. PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. JOSEPH SCHWARTZ & ASSOC 225 S CANAL ST CHICAGO, IL 80661 PAYER'S federal identification number RECIPIENT'S identification number 74-1121134 RECIPIENT'S name Account number (see instructions) CORRECTED (if checked) 499-45-4939 GERALD P RYAN Street address (including apt. no.) 501 MAIN ST City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Form 1099-DIV (keep for your records) 1a Total ordinary dividends 4000.00 $ 1b Qualified dividends $ 3200.00 2a Total capital gain distr. $ 7000.00 2c Section 1202 gain $ 3 Nondividend distributions $ 6 Foreign tax paid $ 8 Cash liquidation distributions $ FATCA filing 10 Exempt-interest dividends requirement ■ OMB No. 1545-0110 www.irs.gov/form1099div 2016 Form 1099-DIV 2b Unrecap. Sec. 1250 gain $ 2d Collectibles (28%) gain $ 4 Federal income tax withheld $ 5 Investment expenses $ 7 Foreign country or U.S. possession 9 Noncash liquidation distributions $ 11 Specified private activity bond interest dividends $ $ 12 State 13 State identification no 14 State tax withheld $ Dividends and Distributions Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service CORRECTED (if checked) PAYER'S name, street address, city or town, state or province, country, ZIP 1a Total ordinary dividends or foreign postal code, and telephone no. FIRST NATIONAL BANK OF NEWTON 1600 KANSAS ST NEWTON, KS 67114 PAYER'S federal identification number RECIPIENT'S identification number 76-3357980 RECIPIENT'S name GERALD P RYAN Street address (including apt. no.) 501 MAIN ST City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Account number (see instructions) 499-45-4939 Form 1099-DIV (keep for your records) $ 1b Qualified dividends 1300.00 $ 1300.00 2a Total capital gain distr. $ 2c Section 1202 gain $ 3 Nondividend distributions $ 6 Foreign tax paid OMB No. 1545-0110 www.irs.gov/form1099div 2016 Form 1099-DIV 2b Unrecap. Sec. 1250 gain $ 2d Collectibles (28%) gain $ 4 Federal income tax withheld $ 5 Investment expenses $ 7 Foreign country or U.S. possession $ 8 Cash liquidation distributions 9 Noncash liquidation distributions $ $ FATCA filing 10 Exempt-interest dividends requirement ☐ 11 Specified private activity bond interest dividends $ $ 12 State 13 State identification nol 14 State tax withheld $ Dividends and Distributions Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. FIRST NATIONAL BANK OF NEWTON 1600 KANSAS ST NEWTON, KS 67114 PAYER'S federal identification number RECIPIENT'S identification number 76-3357980 499-45-4939 RECIPIENT'S name GERALD & MOIRA RYAN Street address (including apt, no.) 501 MAIN ST CORRECTED (if checked) Payer's RTN (optional) City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Account number (see instructions) Form 1099-INT (keep for your records) 1 Interest income $ 3200.00 2 Early withdrawal penalty 6 Foreign tax paid $ 8 Tax-exempt interest $ 3 Interest on U.S. Savings Bonds and Treas, obligations $ 10 Market discount OMB No. 1545-0112 $ 4 Federal income tax withheld 5 Investment expenses I$ $ 7 Foreign country or U.S. possession 2016 14 Tax-exempt and tax credit bond CUSIP no. Form 1099-INT www.irs.gov/form1099int 9 Specified private activity bond interest $ 11 Bond premium Interest Income Copy B For Recipient $ FATCA filing $ requirement 12 Bond premium on Treasury obligations 13 Bond premium on tax-exempt bond $ $ 15 State 16 State identification no. 17 State tax withheld This is important tax information and is being furnished to the Internal Revenue Service. If vice. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service PAYER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. CENTRAL KANSAS SAVINGS & LOAN 5th AND HOLLIDAY SIS TOPEKA, KS 66607 PAYER'S federal identification number RECIPIENT'S identification number 76-7893456 RECIPIENT'S name MOIRA RYAN Street address (including apt. no.) 501 MAIN ST Account number (see instructions) CORRECTED (if checked) Payer's RTN (optional) 455-49-9090 City or town, state or province, country, and ZIP or foreign postal code NEWTON, KS 67114 Form 1099-INT (keep for your records) 1 Interest income $ 4700.00 2 Early withdrawal penalty 6 Foreign tax paid $ 8 Tax-exempt interest 3 Interest on U.S. Savings Bonds and Treas, obligations |$ 10 Market discount OMB No. 1545-0112 $ 4 Federal income tax withheld 5 Investment expenses $ $ 7 Foreign country or U.S. possession 2016 14 Tax-exempt and tax credit bond CUSIP no. Form 1099-INT www.irs.gov/form1099int 9 Specified private activity bond interest $ FATCA filing $ requirement 12 Bond premium on Treasury obligations 13 Bond premium on tax-exempt bond $ $ 15 State 16 State identification no. $ 11 Bond premium Interest Income Copy B For Recipient This is important tax information and is being furnished to the Internal Revenue Service. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported. 17 State tax withheld $ Department of the Treasury - Internal Revenue Service 2.6 Sale of Corporate Stock: The Ryans sold the following shares of common stock in privately held corporations: Date of Sale: Proceeds from Sale: Description Of Stock 1,200 Shares Union Pacific Corp. 200 Shares CSX Corp. 100 Shares Novara Corp. 5,000 Shares Pfau Corp. Date of Acquisition: 3/9/11 12/12/16 3/17/06 5/19/16 11/12/16 12/30/16 $41,000 $10,300 $45,200 4/20/16 6/14/16 $65,000 Method of Acquisition: Purchased by Ryans for $29,000 Received by Moira as gift from sister. Basis to sister at time of gift was $10,800. Received as inheritance from Moira's mother. FMV At time of death Was $44,350.* Purchased by Ryans for $89,000 Method Sale Sold to neighbor Sold to friend Sold to Moira's cousin Sold to Gerald's brother *The executor of Jane Sullivan's estate does not intend to elect the alternate valu ion method. All stocks listed above were held by the Ryans for investment purposes. None was purchased directly from the corporation involved, nor was any held in a brokerage company account. 2.7 Other Income: A. Gerald owns a 20 percent interest in Central Kansas Oilfield, Inc., a subchapter S Corporation. Although Gerald attends annual shareholder meetings, he does not participate in the management or operation of this corporation. His K-1 filed by Central Kansas Oilfield, Inc. is attached. His adjusted basis in his stock in Central Kansas Oilfield, Inc. as of December 31, 2016, was $90,000. Central Kansas Oilfield, Inc. does not have any working interests in any oil and natural gas properties. B. The Ryans received the following: • An inheritance from Moira's mother consisting of the stock in Novara Corporation listed in Section 2.6 above and $55,000 in cash. • A trip to Ireland worth $3,800 as a retirement gift from Gerald's brother, Fred. • Royalty income consisting of $300 paid to Gerald for his autobiographical story entitled "My Life on the Atchison, Topeka and Santa Fe" published in Trains Magazine. The magazine publisher was not required to file a Form 1099-MISC with the IRS. • Gerald was named the "Outstanding Railroader of the Year" by his local of the United Transportation Union. He received a check for $1,000 as part of this award. Moira promptly spent the money.

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Detailed Explanation Before we begin preparing Gerald and Moira Ryans federal income tax return lets first summarize the pertinent data that was supplied 1 Personal Information Gerald Padraig Ryan SSN ... View the full answer