Note: This problem is for the 2021 tax year. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2019. He lives at 4680 Dogwood Lane, Springfield, MO 65801. He is employed as a paralegal by a local law firm. During 2021, he had the following receipts: Logan inherited securities worth $60,000 from his uncle, Daniel, who died in 2021. Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2016, for $85,000 and held as an investment. Because the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5,2021 , for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died. While Logan and his dependents are covered by his employer's health insurance policy, he is subject to a deductible, and dental care is not included. The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed mother, who lives with him (see below). Logan normally pledges $2,400 ( $200 per month) each year to his church. On December 5,2021 , upon the advice of his pastor, he prepald his pledge for 2022 . Logan's household, all of whom he supports, includes the following: Helen recelves a modest Social Security benefit. Asher, a son, is a full-time student in dental school and earns $4,500 as a part-time dental assistant. Mia, a daughter, does not work and is engaged to be married. Federal income tax of $4,200 was withheld from his wages. Compute Logan's income tax for 2021. If Logan has any overpayment on his income tax, he wants the refund sent to him. Assume that the proper amounts of Social Security and Medicare taxes were withheld. Logan received the approprlate coronavirus recovery rebates (economic impact payments); related questions in ProConnect Tox should be ignored. Logan does not own and did not use any virtual currency during the year, and he does not want to contribute to the Presidential Election Campaign Fund. - Make realistic assumptions about any missing data. - Enter all amounts as positive numbers except any losses. Use the minus sign to indicate a loss. - If an amount box does not require an entry or the answer is zero, enter " 0 ". - It may be necessary to complete the other tax schedules before completing Form 1040. - Use the included tax rate schedules to compute the tax. When computing the tax liability, do not round your immediate calculations. If required round your final answers to the nearest dollar. Complete Form 1040 below for Logan Taylor: Form 1040 At any time during 2021, did you recelve, sell, exchange, or otherwise dispose of any financial interest in any virtual currency? Standard Deduction Age/Blindness You: Spouse: Form 1040 1 Wages, salaries, tps, etc. Attach Form(s) W-2........................ 1 . Form 1040 Form 1040 Form 1040(2021) Logan B. Taylor 16 Tax (see instructions). Check if any from Form(5): 18814249723 17 Amount from Schedule 2, line 3 18 Add lines 16 and 17 19 Nonrefundable child tax credit or credit for other dependents from Schedule 8812 20 Amount from Schedule 3 , line 8, 21 Add lines 19 and 20 22. Subtract line 21 from line 18. If zero or less, enter 0 23 Other taxes, including self-employment tax, from Schedule 2 , line 21, 24 Add lines 22 and 23. This is your total tax. a Form(s) W-2.............................. 25 a Form 1040 c Other forms (see instructions) d Add lines 25a through 25c.......... If you have a 262021 estimated tax payments and amount applied from 2020 return. qualifying child, 27a Earned income credit (EIC) 27a attach Sch. EIC. Check here if you were born after January 1, 1998, and before January 2, 2004, and you satisfy all the other requirements for taxpayers who are at least age 18, to claim the EIC. See instructions . b Nontaxable combat pay election.. c Prior year (2019) eamed income .. 27c 28 Refundable child tax credit or additional child tax credit from schedule 8812.......... 29 American opportunity credit from Form 8863, line 8. 30 Recovery rebate credit, See instructions............... \begin{tabular}{|l|} \hline 28 \\ \hline 29 \\ \hline 30 \\ \hline \end{tabular} Form 1040 Third Party Do you want to aliow another person to discuss this return with the IRS? See instructions. Yes. Complete below. Form 1040 Here taxpayer) is based on all information of which preparer has any knowledge. Complete Logan's Schedule A for 2021. Schedule A 3 Multiply line 2 by 7.5%(0.075) 4 Subtract line 3 from line . 1. If line 3 is more than line 1, enter-0- Taxes You 5 State and local taxes. Palid a State and local income taxes or general sales taxes. You may include either income taxes or general sales taxes on line 5 , but not both. If you elect to include general sales taxes instead of income taxes, check this box. b State and local real estate taxes (see instructions) c. State and local personal property taxes. separately) .............. Schedule A Schedule A 9 Investment interest. Attach Form 4952 if required. See instructions. Caution: If you made a gift and got a 13 Carryover from prior year ........................... 13 benefit for it, Casualty and 15 Casualty and theft loss(es) from a federally declared disaster (other than net qualified disaster Theft Losses losses). Attach Form 4684 and enter the amount from line 18 of that form. See instructions. 15 Other 16 Other-from list in instructions. List type and amount v Itemized Deductions Total 17 Add the amounts in the for right column for lines 4 through 16. Also, enter this amount on Itemized Form 1040 or 10405R, line 12a. Deductions 18 If you elect to itemize deductions even though they are less than your standard deduction, check this box. BAA For Paperwork Reduction Act Notice, see the Instructions for Forms 1040 and 1040-5R. Schedule A (Form 1040) 2021 Complete Logan's Schedule D for 2021. Use the minus sign to indicate a loss. Schedule D Part I Short-Term Capital Gains and Losses - Generally Assets Held One Year or Less (see instructions) See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars: 1a Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the 1RS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 16 . 2b Totals for all transactions reported on Form(s) 8949 with Box A checked. 2. Totals for all transactions reported on Form(s) 8949 with Box 8 checked Schedule D 3 Totals for all transactions reported on Form(s) 8949 with Box C checked. 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824. 6 Short-term capital Soss carryover. Enter the amount, if any, from line 8 of your Capltal Loss Carryover Worksheet in the instructions. 7 Net short-term capital gain or (loss). Combine lines 1 a through 6 in column (h). If you have any long-term Part II Long-Term Capital Gains and Losses - Generally Assets Held More Than One Year (see Instructions) See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars. Schedule D. Ba Totals for all long-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on form 8949 , leave this line blank and 99 to line 8b. 86 Totals for all transactions reported on Form(s) 8949 with Box D checked. 9 Totals for all transactions reported on Form(s) 8949 with Box E checked 10. Totals for all transactions reported on Form(s) 8949 with Box F checked. 11 Gain from form 4797, Part 1; long-term gain from forms 2439 and 6252; and long-term gain or (loss) from Forms 4684,6781 , and 8824 . 12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K1. 13 Capital gain distributions. See the instrs 14 Long-term copital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover Schedule D 14 Long-term capital loss carryover. Enter the amount, If any, from line 13 of your Capital Loss Carryover Worksheet in the instructions. 15 Net long-term capital gain or (loss). Combine lines 8 a through 14 in column (h). Then, go to Part III on the back. BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule D (Form 1040) 2021 Schedule D (Form 1040) 2021 Logan B. Taylor 123-45-6787 Part III Summary 16 Combine lines 7 and 15 and enter the result. - If line 16 is a gain, enter the amount from line 16 on Form 1040,1040-SR, or 1040-NR, line.7. Then, go to line 17 below. - If line 16 is a loss, skip lines 17 through 20 below. Then, 90 to line 21 . Also be sure to complete line 22. - If line 16 is zero, skip lines 17 through 21 below and enter - O- on Form 1040, 1040-5R, or 1040-NR, line 7. Then, 90 to line 22 . 17 Are lines 15 and 16 both gains? 17 Are lines 15 and 16 both gains? Yes. Go to line 18 . No. Skip lines 18 through 21 , and 90 to line 22. 18 If you are required to complete the 28% Rate Gain Worksheet (see instructions), enter the amount, if 19 If you are required to complete the Unrecaptured Section 1250 Gain Worksheet (see instructions), enter the amount, if any, from line 18 of that worksheet; 20 Are lines 18 and 19 both zero or blank and are you not filing Form 4952? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 10405R, line 16 . Don't complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions, Don't complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions. Don't complete lines 21 and 22 below. 21 If line 16 is a loss, enter there and on Form 1040,10405R, or 1040NR, line 7 , the smaller of: - The loss on line 16; or - ($3,000), or if married filing separately, ($1,500). Note: When figuring which amount is smaller, treat both amounts as positive numbers. 22 Do you have qualified dividends on Form 1040, 1040-5R, or 1040-NR, line 3a? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 1040 -5R; line 16 . No. Complete the rest of Form 1040, 1040-SR, or 1040-NR. Compute Logan's form 8949 below. Note: Only page 2 of the form is required to be completed for this problem and is provided below. You must check Box D, E, or F below. Check only one box. If more than one box applies for your fong-term transactions, complete a separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need, (D) Long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above) (E) Long-term transactions reported on Form(s) 1099-B showing basis wasn't reported to the IRS (F) Long-term transactions not reported to you on Form 1099-B Form 8949 Focm 8949 2. Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts), Enter each total here and include on your Schedule D, line 8b (ir BoD above is checked), line 9 (if Box E above is checked), or line 10 (if Box F above is checked) r Note: If you checked Box D above but the basis reported to the IRS was incorrect, enter in column (e) the basis as reported to the IRS, and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to figure the amount of the adjustment. Schedule 8812 Complete Logan's Schedule 8812. Part I-A Child Tax Credit and Credit for Other Dependents 1 Enter the amount from line 11 of your Form 1040,1040SR, or 1040=NR. 2a Enter income from Puerto Rico that you excluded.. b Enter the amounts from lines 45 and 50 of your form 2555. C Enter the amount from line 15 of your form 4563. d Add lines 2a through 2c. Schedule 8612 3 Add lines 1 and 20 4a Number of qualifying children under age 18 with the required social security number b Number of chlldren included on line 4 a who were under age 6 at the end of 2021 . . c. Subtract line 4b from line 4a 5 If line 4a is more than zero, enter the amount from the Line 5 Worksheet; otherwise, enter 6 Number of other dependents, including any qualifying children who are not under age 18 or who do not have the required social security number ........... 6 Caution: Do not include yourself, your spouse, or anyone who is not a U.S, citizen, U.S, national, or U.S. resident alien. Aso, do not include anyone you included on line 4a. 7 Multiply line 6 by $500. 8. Add lines 5 and 7 9 Enter the amount shown below for your filing status. Married filing jointly $400,000 Schedule 8812 9 Enter the amount shown below for your filing status. - Married filing jointly- $400,000 - All other filing statuses $200,000 10 Subtract line 9 from line 3. If zero or less, enter 0=. - If more than zero and not a multiple of $1,000, enter the next multiple of $1,000. For example, if the result is $425, enter $1,000; if the result is $1,025, enter $2,000, etci 11 Multiply line 10 by 5%(0.05) 12. Subtract line 11 from line 8 . If aero or less, enter-0- 13 Check all the boxes that apply to you (or your spouse if married filing fointly). A Check here if you (or your spouse if married filing jointly) have a principal piace of abode in the United States for more than half of 2021 B Check here if you (or your spouse if married filing jointly) are a bona fide resident of Puerto Rico for 2021 : Schedule 8812 B Check here if you (or your spouse if married filing jointly) are a bona fide resident of Puerto Rico for 2021 . Part I-B Filers Who Check a Box on Line 13 Caution: If you did not check a box on line 13 , do not complete Part I-B; instead, skip to Part I-C. 14 a Enter the smaller of line 7 or line 12 b Subtract line 14 a from line 12 c. If line 14a is zero, enter 0; otherwise, enter the amount from the Credit Limit Worksheet A. d Enter the smaller of line e Add lines 14b and 14d. f Enter the aggregate amount of advance child tax credit payments you (and your spouse if filing jointly) received for 2021. See your Letter(s) 6419 for the amounts to include on this line. If you are missing Letter 6419, see the instructions before entering an amount on this line . Caution: If the amount on this line doesn't match the aggregate amounts reported to you (and your spouse if: fing jointly) on your Letter(s) 6419 , the processing of your retum will be delayed. hedule 8812 d Enter the smalier of line 14 a or line 14 e Add lines 14b and 14d f Enter the aggregate amount of advance child tax credit payments you (and your spouse if filing jointly) received for 2021 . See your Letter(s) 6419 for the amounts to include on this line. If you are missing Letter 6419 , see the instructions before entering an amount on this line. Caution: If the amount on this line doesn't match the aggregate amounts reported to you fand your spouse if filing jointly) on your Letter(s) 6419 , the processing of your return will be delayed. 9 Subtract line 14f from line 14e. If zero or less, enter 0 - on lines 149 through 14 and go to Part III h Enter the smaller of line 14d or line 149 . This is your credit for other dependents. Enter this amount on line 19 of your Form 1040, 1040-5R, or 1040-NR I Subtract line 14h from line 14g. This is your refundable child tax credit. Enter this amount on line 28 of your Form 1040,10405R, or 1040 -NR 1.4i BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule 8812 (Form 1040) 2021 In early 2022, the following take place: - Helen decides that she wants to live with one of her daughters and moves to Arizona. - Asher graduates from dental school and joins an existing practice in St. Louls. - Mia marries, and she and her spouse move in with his parents. - Using the insurance proceeds he recelved on Daniel's death, Logan pays off the mortgage on his personal residence. Logan believes that these events may have an effect on his tax position for 2022. Therefore, he requests your advice. Complete the letter to Logan explaining in general terms the changes that will occur for tax purposes. Assume that Logan's salary and other factors not mentioned (e.9., property and state income taxes) will remain the same. The standard deduction for qualifying widower is $25,900, for head of household $19,400 and for single $12,950 in 2022. Use the 2022 tax rate schedules (click here) in projecting Logan's tax for 2022. In response to your inquiry regarding the Federal income tax situation for 2022, the news favorable. The following developments will cause in your taxes: - Your filing status moves from surviving spouse to The result is a shift from the progressive tax rates. - The capital loss deduction is $ which is 9 less than last year: - For various reasons, no longer qualify as dependents. - Because of these changes you will benefit from Based on last year's data, an estimate of your federal income tax liability for 2022 is If I can be of further assistance to you in this matter, please do not hesitate to contact me. Sincerely, Eduardo Rodriguez Partner 2021 Tax Rate Schedules Note: This problem is for the 2021 tax year. Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2019. He lives at 4680 Dogwood Lane, Springfield, MO 65801. He is employed as a paralegal by a local law firm. During 2021, he had the following receipts: Logan inherited securities worth $60,000 from his uncle, Daniel, who died in 2021. Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2016, for $85,000 and held as an investment. Because the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5,2021 , for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died. While Logan and his dependents are covered by his employer's health insurance policy, he is subject to a deductible, and dental care is not included. The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed mother, who lives with him (see below). Logan normally pledges $2,400 ( $200 per month) each year to his church. On December 5,2021 , upon the advice of his pastor, he prepald his pledge for 2022 . Logan's household, all of whom he supports, includes the following: Helen recelves a modest Social Security benefit. Asher, a son, is a full-time student in dental school and earns $4,500 as a part-time dental assistant. Mia, a daughter, does not work and is engaged to be married. Federal income tax of $4,200 was withheld from his wages. Compute Logan's income tax for 2021. If Logan has any overpayment on his income tax, he wants the refund sent to him. Assume that the proper amounts of Social Security and Medicare taxes were withheld. Logan received the approprlate coronavirus recovery rebates (economic impact payments); related questions in ProConnect Tox should be ignored. Logan does not own and did not use any virtual currency during the year, and he does not want to contribute to the Presidential Election Campaign Fund. - Make realistic assumptions about any missing data. - Enter all amounts as positive numbers except any losses. Use the minus sign to indicate a loss. - If an amount box does not require an entry or the answer is zero, enter " 0 ". - It may be necessary to complete the other tax schedules before completing Form 1040. - Use the included tax rate schedules to compute the tax. When computing the tax liability, do not round your immediate calculations. If required round your final answers to the nearest dollar. Complete Form 1040 below for Logan Taylor: Form 1040 At any time during 2021, did you recelve, sell, exchange, or otherwise dispose of any financial interest in any virtual currency? Standard Deduction Age/Blindness You: Spouse: Form 1040 1 Wages, salaries, tps, etc. Attach Form(s) W-2........................ 1 . Form 1040 Form 1040 Form 1040(2021) Logan B. Taylor 16 Tax (see instructions). Check if any from Form(5): 18814249723 17 Amount from Schedule 2, line 3 18 Add lines 16 and 17 19 Nonrefundable child tax credit or credit for other dependents from Schedule 8812 20 Amount from Schedule 3 , line 8, 21 Add lines 19 and 20 22. Subtract line 21 from line 18. If zero or less, enter 0 23 Other taxes, including self-employment tax, from Schedule 2 , line 21, 24 Add lines 22 and 23. This is your total tax. a Form(s) W-2.............................. 25 a Form 1040 c Other forms (see instructions) d Add lines 25a through 25c.......... If you have a 262021 estimated tax payments and amount applied from 2020 return. qualifying child, 27a Earned income credit (EIC) 27a attach Sch. EIC. Check here if you were born after January 1, 1998, and before January 2, 2004, and you satisfy all the other requirements for taxpayers who are at least age 18, to claim the EIC. See instructions . b Nontaxable combat pay election.. c Prior year (2019) eamed income .. 27c 28 Refundable child tax credit or additional child tax credit from schedule 8812.......... 29 American opportunity credit from Form 8863, line 8. 30 Recovery rebate credit, See instructions............... \begin{tabular}{|l|} \hline 28 \\ \hline 29 \\ \hline 30 \\ \hline \end{tabular} Form 1040 Third Party Do you want to aliow another person to discuss this return with the IRS? See instructions. Yes. Complete below. Form 1040 Here taxpayer) is based on all information of which preparer has any knowledge. Complete Logan's Schedule A for 2021. Schedule A 3 Multiply line 2 by 7.5%(0.075) 4 Subtract line 3 from line . 1. If line 3 is more than line 1, enter-0- Taxes You 5 State and local taxes. Palid a State and local income taxes or general sales taxes. You may include either income taxes or general sales taxes on line 5 , but not both. If you elect to include general sales taxes instead of income taxes, check this box. b State and local real estate taxes (see instructions) c. State and local personal property taxes. separately) .............. Schedule A Schedule A 9 Investment interest. Attach Form 4952 if required. See instructions. Caution: If you made a gift and got a 13 Carryover from prior year ........................... 13 benefit for it, Casualty and 15 Casualty and theft loss(es) from a federally declared disaster (other than net qualified disaster Theft Losses losses). Attach Form 4684 and enter the amount from line 18 of that form. See instructions. 15 Other 16 Other-from list in instructions. List type and amount v Itemized Deductions Total 17 Add the amounts in the for right column for lines 4 through 16. Also, enter this amount on Itemized Form 1040 or 10405R, line 12a. Deductions 18 If you elect to itemize deductions even though they are less than your standard deduction, check this box. BAA For Paperwork Reduction Act Notice, see the Instructions for Forms 1040 and 1040-5R. Schedule A (Form 1040) 2021 Complete Logan's Schedule D for 2021. Use the minus sign to indicate a loss. Schedule D Part I Short-Term Capital Gains and Losses - Generally Assets Held One Year or Less (see instructions) See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars: 1a Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the 1RS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 16 . 2b Totals for all transactions reported on Form(s) 8949 with Box A checked. 2. Totals for all transactions reported on Form(s) 8949 with Box 8 checked Schedule D 3 Totals for all transactions reported on Form(s) 8949 with Box C checked. 4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824. 6 Short-term capital Soss carryover. Enter the amount, if any, from line 8 of your Capltal Loss Carryover Worksheet in the instructions. 7 Net short-term capital gain or (loss). Combine lines 1 a through 6 in column (h). If you have any long-term Part II Long-Term Capital Gains and Losses - Generally Assets Held More Than One Year (see Instructions) See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars. Schedule D. Ba Totals for all long-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on form 8949 , leave this line blank and 99 to line 8b. 86 Totals for all transactions reported on Form(s) 8949 with Box D checked. 9 Totals for all transactions reported on Form(s) 8949 with Box E checked 10. Totals for all transactions reported on Form(s) 8949 with Box F checked. 11 Gain from form 4797, Part 1; long-term gain from forms 2439 and 6252; and long-term gain or (loss) from Forms 4684,6781 , and 8824 . 12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K1. 13 Capital gain distributions. See the instrs 14 Long-term copital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover Schedule D 14 Long-term capital loss carryover. Enter the amount, If any, from line 13 of your Capital Loss Carryover Worksheet in the instructions. 15 Net long-term capital gain or (loss). Combine lines 8 a through 14 in column (h). Then, go to Part III on the back. BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule D (Form 1040) 2021 Schedule D (Form 1040) 2021 Logan B. Taylor 123-45-6787 Part III Summary 16 Combine lines 7 and 15 and enter the result. - If line 16 is a gain, enter the amount from line 16 on Form 1040,1040-SR, or 1040-NR, line.7. Then, go to line 17 below. - If line 16 is a loss, skip lines 17 through 20 below. Then, 90 to line 21 . Also be sure to complete line 22. - If line 16 is zero, skip lines 17 through 21 below and enter - O- on Form 1040, 1040-5R, or 1040-NR, line 7. Then, 90 to line 22 . 17 Are lines 15 and 16 both gains? 17 Are lines 15 and 16 both gains? Yes. Go to line 18 . No. Skip lines 18 through 21 , and 90 to line 22. 18 If you are required to complete the 28% Rate Gain Worksheet (see instructions), enter the amount, if 19 If you are required to complete the Unrecaptured Section 1250 Gain Worksheet (see instructions), enter the amount, if any, from line 18 of that worksheet; 20 Are lines 18 and 19 both zero or blank and are you not filing Form 4952? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 10405R, line 16 . Don't complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions, Don't complete lines 21 and 22 below. No. Complete the Schedule D Tax Worksheet in the instructions. Don't complete lines 21 and 22 below. 21 If line 16 is a loss, enter there and on Form 1040,10405R, or 1040NR, line 7 , the smaller of: - The loss on line 16; or - ($3,000), or if married filing separately, ($1,500). Note: When figuring which amount is smaller, treat both amounts as positive numbers. 22 Do you have qualified dividends on Form 1040, 1040-5R, or 1040-NR, line 3a? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 1040 -5R; line 16 . No. Complete the rest of Form 1040, 1040-SR, or 1040-NR. Compute Logan's form 8949 below. Note: Only page 2 of the form is required to be completed for this problem and is provided below. You must check Box D, E, or F below. Check only one box. If more than one box applies for your fong-term transactions, complete a separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need, (D) Long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above) (E) Long-term transactions reported on Form(s) 1099-B showing basis wasn't reported to the IRS (F) Long-term transactions not reported to you on Form 1099-B Form 8949 Focm 8949 2. Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts), Enter each total here and include on your Schedule D, line 8b (ir BoD above is checked), line 9 (if Box E above is checked), or line 10 (if Box F above is checked) r Note: If you checked Box D above but the basis reported to the IRS was incorrect, enter in column (e) the basis as reported to the IRS, and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to figure the amount of the adjustment. Schedule 8812 Complete Logan's Schedule 8812. Part I-A Child Tax Credit and Credit for Other Dependents 1 Enter the amount from line 11 of your Form 1040,1040SR, or 1040=NR. 2a Enter income from Puerto Rico that you excluded.. b Enter the amounts from lines 45 and 50 of your form 2555. C Enter the amount from line 15 of your form 4563. d Add lines 2a through 2c. Schedule 8612 3 Add lines 1 and 20 4a Number of qualifying children under age 18 with the required social security number b Number of chlldren included on line 4 a who were under age 6 at the end of 2021 . . c. Subtract line 4b from line 4a 5 If line 4a is more than zero, enter the amount from the Line 5 Worksheet; otherwise, enter 6 Number of other dependents, including any qualifying children who are not under age 18 or who do not have the required social security number ........... 6 Caution: Do not include yourself, your spouse, or anyone who is not a U.S, citizen, U.S, national, or U.S. resident alien. Aso, do not include anyone you included on line 4a. 7 Multiply line 6 by $500. 8. Add lines 5 and 7 9 Enter the amount shown below for your filing status. Married filing jointly $400,000 Schedule 8812 9 Enter the amount shown below for your filing status. - Married filing jointly- $400,000 - All other filing statuses $200,000 10 Subtract line 9 from line 3. If zero or less, enter 0=. - If more than zero and not a multiple of $1,000, enter the next multiple of $1,000. For example, if the result is $425, enter $1,000; if the result is $1,025, enter $2,000, etci 11 Multiply line 10 by 5%(0.05) 12. Subtract line 11 from line 8 . If aero or less, enter-0- 13 Check all the boxes that apply to you (or your spouse if married filing fointly). A Check here if you (or your spouse if married filing jointly) have a principal piace of abode in the United States for more than half of 2021 B Check here if you (or your spouse if married filing jointly) are a bona fide resident of Puerto Rico for 2021 : Schedule 8812 B Check here if you (or your spouse if married filing jointly) are a bona fide resident of Puerto Rico for 2021 . Part I-B Filers Who Check a Box on Line 13 Caution: If you did not check a box on line 13 , do not complete Part I-B; instead, skip to Part I-C. 14 a Enter the smaller of line 7 or line 12 b Subtract line 14 a from line 12 c. If line 14a is zero, enter 0; otherwise, enter the amount from the Credit Limit Worksheet A. d Enter the smaller of line e Add lines 14b and 14d. f Enter the aggregate amount of advance child tax credit payments you (and your spouse if filing jointly) received for 2021. See your Letter(s) 6419 for the amounts to include on this line. If you are missing Letter 6419, see the instructions before entering an amount on this line . Caution: If the amount on this line doesn't match the aggregate amounts reported to you (and your spouse if: fing jointly) on your Letter(s) 6419 , the processing of your retum will be delayed. hedule 8812 d Enter the smalier of line 14 a or line 14 e Add lines 14b and 14d f Enter the aggregate amount of advance child tax credit payments you (and your spouse if filing jointly) received for 2021 . See your Letter(s) 6419 for the amounts to include on this line. If you are missing Letter 6419 , see the instructions before entering an amount on this line. Caution: If the amount on this line doesn't match the aggregate amounts reported to you fand your spouse if filing jointly) on your Letter(s) 6419 , the processing of your return will be delayed. 9 Subtract line 14f from line 14e. If zero or less, enter 0 - on lines 149 through 14 and go to Part III h Enter the smaller of line 14d or line 149 . This is your credit for other dependents. Enter this amount on line 19 of your Form 1040, 1040-5R, or 1040-NR I Subtract line 14h from line 14g. This is your refundable child tax credit. Enter this amount on line 28 of your Form 1040,10405R, or 1040 -NR 1.4i BAA For Paperwork Reduction Act Notice, see your tax return instructions. Schedule 8812 (Form 1040) 2021 In early 2022, the following take place: - Helen decides that she wants to live with one of her daughters and moves to Arizona. - Asher graduates from dental school and joins an existing practice in St. Louls. - Mia marries, and she and her spouse move in with his parents. - Using the insurance proceeds he recelved on Daniel's death, Logan pays off the mortgage on his personal residence. Logan believes that these events may have an effect on his tax position for 2022. Therefore, he requests your advice. Complete the letter to Logan explaining in general terms the changes that will occur for tax purposes. Assume that Logan's salary and other factors not mentioned (e.9., property and state income taxes) will remain the same. The standard deduction for qualifying widower is $25,900, for head of household $19,400 and for single $12,950 in 2022. Use the 2022 tax rate schedules (click here) in projecting Logan's tax for 2022. In response to your inquiry regarding the Federal income tax situation for 2022, the news favorable. The following developments will cause in your taxes: - Your filing status moves from surviving spouse to The result is a shift from the progressive tax rates. - The capital loss deduction is $ which is 9 less than last year: - For various reasons, no longer qualify as dependents. - Because of these changes you will benefit from Based on last year's data, an estimate of your federal income tax liability for 2022 is If I can be of further assistance to you in this matter, please do not hesitate to contact me. Sincerely, Eduardo Rodriguez Partner 2021 Tax Rate Schedules