Note: This problem is for the 2023 tax year.Lance H. and Wanda B. Dean are married and live at 431 Yucca Drive, Santa Fe, NM 87501. Lanceworks for the convention bureau of the local Chamber of Commerce, and Wanda is employed part-time as a paralegal for a law firm.During 2023, the Deans had the following receipts:Line Item Description Amount AmountSalaries ($60,000 for Lance, $43,000 forWanda) $103,000Interest incomeCity of Albuquerque general purpose bonds $1,000Ford Motor company bonds 1,100Ally Bank certificate of deposit 400Total 2,500Child support payments from John Allen 7,200Annual gifts from parents 26,000Settlement from Roadrunner Touring Company 90,000Lottery winnings 600Federal income tax refund (for tax year 2022)400Wanda was previously married to John Allen. When they divorced several years ago, Wanda wasawarded custody of their two children, Penny and Kyle. (Note: Wanda has never issued a Form8332 waiver.) Under the divorce decree, John was obligated to pay alimony and child supportthealimony payments were to terminate if Wanda remarried.In July, while going to lunch in downtown Santa Fe, Wanda was injured by a tour bus. Because thedriver was clearly at fault, the owner of the bus, Roadrunner Touring Company, paid her medicalexpenses (including a one-week stay in a hospital). To avoid a lawsuit, Roadrunner alsotransferred $90,000 to her in settlement of the personal injuries she sustained.The Deans had the following expenditures for 2023:Line Item Description Amount AmountMedical expenses (not covered by insurance) $7,200TaxesProperty taxes on personal residence $3,600State of New Mexico income tax (includes amount withheldfrom wages during 2023)4,200Total 7,800Interest on home mortgage (First National Bank)6,500Charitable contributions (cash)3,600Life insurance premiums (policy on Lance's life)1,200Contribution to traditional IRA (on Wanda's behalf)6,500Traffic fines 300Contribution to the reelection campaign fund of the mayor of Santa Fe 500Funeral expenses for Wayne Boyle 6,300The life insurance policy was taken out by Lance several years ago and designates Wanda as thebeneficiary. As a part-time employee, Wanda is excluded from coverage under her employer'spension plan. Consequently, she provides for her own retirement with a traditional IRA obtained ata local trust company. Because the mayor is a member of the local Chamber of Commerce, Lancefelt compelled to make the political contribution.The Deans' household includes the following, for whom they provide more than half of the support:Line ItemDescription Social Security Number Birth DateLance Dean (age 42)123-45-678612/16/1981Wanda Dean (age 40)123-45-678708/08/1983Penny Allen (age 19)123-45-678810/09/2004Kyle Allen (age 16)123-45-678005/03/2007Wayne Boyle (age 75)123-45-678506/15/1948Penny graduated from high school on May 9,2023, and is undecided about college. During 2023,she earned $8,500(placed in a savings account) playing a harp in the lobby of a local hotel.Wayne is Wanda's widower father who died on December 20,2023. For the past few years, Waynequalified as a dependent of the Deans.Federal income tax withheld is $3,900(Lance) and $1,600(Wanda). The proper amount of SocialSecurity and Medicare tax was withheld.Required:Determine the Federal income tax for 2023 for the Deans on a joint return by completing theappropriate forms. Use Form 1040 and Schedule 1 to complete this tax return. They do not ownand did not use any digital assets during the year, and they do not want to contribute to thePresidential Election Campaign Fund. If an overpayment results, it is to be refunded to them. Make realistic assumptions about any missing data. Enter all amounts as positive numbers. If an amount box does not require an entry or the answer is zero, enter "0". Use the tax rate schedules included with this problem. When computing the taxliability, do not round your immediate calculations. If required, round your finalanswers to the nearest dollar.Complete Form 1040 below for Lance and Wanda Dean.Form1040 Department of the TreasuryInternal Revenue ServiceU.S. Individual Income Tax Return 2023 OMB No.1545-For the year Jan. 1Dec. 31,2023, or other tax year beginning ,, ending , SeYour first name and middle initialLance H. DeanLast name YourIf joint return, spouse's first name and middle initialWanda B. DeanLast name SpouseHome address (number and street). If you have a P.O. box, see instructions.431 Yucca DriveApt. no. City, town, or post office. If you have a foreignaddress, also complete spaces below.Santa Fe, NM 87501State ZIP codePresidDo you,jointly, wSelectingchange yForeign country name Foreign province/state/county Foreign postal codeFilingStatus SingleMarried filing jointlyMarried filing separately (MFS)Head of household (with qualifying person)(HOH)DigitalAssetsAt any time during 2023, did you: (a) receive (as a reward, award, or payment for propertysell, exchange, or otherwise dispose of a digital asset (or a financial interest in a digital asseStandardDeductionSomeone can claim:You as a dependentYour spouse as a dependentSpouse itemizes on a separate return or you were a dual-statuAge/BlindnessYou:Were born before January 2,1959Are blindWere born before January 2,1959, Are blindNoneSpouse:Was born before January 2,1959Is blindWas born before January 2,1959, Is blindNoneDependentsIf morethan fourdependents,see instructionsand checkhere ........(see instructions): (1) First name Last name (2) Social securitynumber(3) Relationshipto you(4) Check the box if quChild tax credit CPenny Dean 123-45-6788 Child YesNoKyle Dean 123-45-6780 Child YesNoWayne Boyle 123-45-6785 Parent YesNo1a Total amount from Form(s) W-2, box 1(see instructions).......................1aIncomeAttach Form(s)W-2 here. Alsoattach FormsW-2G and1099-R if taxwas withheld.If you did notget a FormW-2, seeinstructions.1iAttach Sch. Bif required.3a 4a StandardDeduction for Single orMarried filingseparately,$13,850 Married filingjointly orQualifyingsurvivingspouse,$27,700 Head ofhousehold,$20,800 If you checkedany boxunder StandardDeduction, seeinstructions.b Household employee wages not reported on Form(s) W-2.......................c Tip income not reported on line 1a (see instructions)..........................d Medicaid waiver payments not reported on Form(s) W-2(see instructions)...........e Taxable dependent care benefits from Form 2441, line 26......................f Employer-provided adoption benefits from Form 8839, line 29...................g Wages from Form 8919, line 6..........................................h Other earned income (see instructions)...................................i Nontaxable combat pay election (see instructions)........ z Add lines 1a through 1h .............................................2a Tax-exempt interest .2a fill in the blank.d3ebaefd402c006_15 b Taxable interest ..........3a Qualified dividends ..b Ordinary dividends .........4a IRA distributions .... b Taxable amount ..........5a Pensions andannuities b Taxable amount ..........6a Social securitybenefits b Taxable amount ..........c If you elect to use the lump-sum election method, check here (see instructions).....7 Capital gain or (loss). Attach Schedule D if required. If not required, check here. ....78 Additional income from Schedule 1, line 10.................................89 Add lines 1z,2b,3b,4b,5b,6b,7, and 8. This is your total income ...............910 Adjustments to income from Schedule 1, line 26.............................11 Subtract line 10 from line 9. This is your adjusted gross income ................12 Standard deduction or itemized deductions (from Schedule A)................13 Qualified business income deduction from Form 8995 or Form 8995-A ..............14 Add lines 12 and 13.................................................15 Subtract line 14 from line 11. If zero or less, enter -0-. This is your taxableincome ...1b1c1d1e1f1g1h1z2b3b4b5a 5b6a 6b101112131415BAA For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions.Form 1040(2023) Lance H and Wanda B Dean 123-45-Tax andCreditsPayments If you have aqualifying child,attach Sch. EIC.161718192021222324 Tax (see instructions). Check if any from Form(s): 18814249723.. Amount from Schedule 2, line 3........................................ Add lines 16 and 17................................................ Child tax credit or credit for other dependents from Schedule 8812................Amount from Schedule 3, line 8........................................Add lines 19 and 20.................................................Subtract line 21 from line 18. If zero or less, enter -0-.........................Other taxes, including self-employment tax, from Schedule 2, line 21..............Add lines 22 and 23. This is your total tax .................................25 afill in the blank d3ebaefd402c006_3025ab25bc262730313233 Federal income tax withheld from: ......................................Form(s) W-2................................... Form(s)1099.................................. Other forms (seeinstructions)......................25cd Add lines 25a through 25c ............................................2023 estimated tax payments and amount applied from 2022 return ..............Earned income credit(EIC)............27.............28 Additional child taxcredit from Schedule8812............ American opportunitycredit from Form 8863,line 8........ Reserved for future use. ........................... Amount from Schedule3, line 15..................... Add lines 27,28,29, and 31. These are your total other payments andrefundable credits .......................................................... Add lines 25d,26, and 32. These are your total payments .....................282929303116 fill in th1718 fill in th19 fill in th2021 fill in th22 fill in th2324 fill in th25d fill in th263233 fill in thRefund 34 If line 33 is more than line 24, subtract line 24 from line 33. This is theamount you overpaid ........................................................35a Amount of line 34 you want refunded to you. If Form 8888 is attached,check here .. Direct deposit? b Routing number c Type: Checking SavingsSee instructions. d Account number36 Amount of line 34 you want applied to your2024 estimated tax .........................................34 fill in th35a fill in th36AmountYou Owe3738 Subtract line 33 from line 24. This is the amount you owe.For details on how to pay, go to www.irs.gov/Payments or see instructions ........... Estimated tax penalty (see instructions).....38...........37Third PartyDesigneeDo you want to allow another person to discuss this return with the IRS?See instructions ............................................ Yes. CompDesignee'sPhonePersonal identificationameno.number (PIN)SignHereJoint return?Seeinstructions.Keep a copy foryour records.Under penalties of perjury, I declare that I have examined this return and accompanying schedthe best of my knowledge and belief, they are true, correct, and complete. Declaration of prepabased on all information of which preparer has any knowledge.Your signature Date Your occupationManagerSpouse's signature. Ifa jointreturn, both mustsign.Date Spouse's occupationParalegalPhone no. Email addressPaidPreparerUse OnlyPreparer's name Preparer's signatureSelf-PreparedDate PTINFirm's name Phone no.Firm's address Firm's EINGo to www.irs.gov/Form1040 for instructions and the latest information.Feedback AreaFeedbackThe calculation of taxable income begins with gross income. Gross income includes all income,unless the tax law provides for a specific exclusion. Individual taxpayers have two categories ofdeductions: (1) deductions for adjusted gross income (deductions from gross income to arrive atadjusted gross income) and (2) deductions from adjusted gross income. As a general rule,personal expenditures are disallowed as deductions in arriving at taxable income. However,Congress allows specified personal expenses as deductions from AGI (commonly referred to asitemized deductions). AGI is an important subtotal that serves as the basis for computingpercentage limitations on certain itemized deductions such as medical expenses, charitablecontributions, and certain casualty losses.Complete Schedule 1 for Lance and Wanda Dean for 2023.SCHEDULE 1(Form 1040)Department of the TreasuryInternal Revenue ServiceAdditional Income and Adjustments to IncomeAttach to Form 1040,1040-SR, or 1040-NR.Go to www.irs.gov/Form1040 for instructions and the latest informatioName(s) shown on Form 1040,1040-SR, or 1040-NRLance H and Wanda B DeanPart I Additional Income8a8b fill in the blank 5223fefbbfdff938c8d8e8f1 Taxable refunds, credits, or offsets of state and local income taxes ..............................2a Alimony received .................................................................b Date of original divorce or separation agreement (see instructions):3 Business income or (loss). Attach Schedule C .............................................4 Other gains or (losses). Attach Form 4797...............................................5 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E ...............6 Farm income or (loss). Attach Schedule F ................................................7 Unemployment compensation ........................................................8 Other income:a Net operating loss .............................................b Gambling ...................................................c Cancellation of debt ............................................d Foreign earned income exclusion from Form 2555.......................Income from Form 8853................................e.........f Income from Form 8889.........................................Alaska Permanent Fund dividends .........................g..........h Jury duty pay ................................................i Prizes and awards ..............................................j Activity not engaged in for profit income ..............................k Stock options .................................................l Income from the rental of personal property if you engaged in therental for profit but were not in the business of renting such property. .................... m Olympic and Paralympic medals and USOC prize money (seeinstructions)...... n Section 951(a) inclusion (see instructions)............................o Section 951A(a) inclusion (see instructions)...........................p Section 461(l) excess business loss adjustment .........................q Taxable distributions from an ABLE account (see instructions)...............8g8h8i8j8k8l8m8n8o8p8qr Scholarship and fellowship grants not reported on Form W-2...............s Nontaxable amount of Medicaid waiver payments included on Form1040, line 1a or 1d ......................................................... t Pension or annuity from a nonqualifed deferred compensation plan ora nongovernmental section 457 plan .................................. u Wages earned while incarcerated ...................................z Other income. List type and amount:8r8s8t8u8z9 Total other income. Add lines 8a through 8z ..............................................10 Combine lines 1 through 7 and 9. This is your additional income. Enter here and on Form 1040,1040-SR, o1040-NR, line 8..................................................................For Paperwork Reduction Act Notice, see your tax return instructions. SchSchedule 1(Form 1040)(2023) Lance H and Wanda B DeanPart II Adjustments to Income1112 Educator expenses ................................................................Certain business expenses of reservists, performing artists, and fee-basis government officials. Attach Form2106..........................................................................13 Health savings account deduction. Attach Form 8889........................................14 Moving expenses for members of the Armed Forces. Attach Form 3903...........................15 Deductible part of self-employment tax. Attach Schedule SE ...................................16 Self-employed SEP, SIMPLE, and qualified plans ...........................................17 Self-employed health insurance deduction ...............................................18 Penalty on early withdrawal of savings ..................................................19a Alimony paid ....................................................................b Recipient's SSN ....................................c Date of original divorce or separation agreement (see instructions):20 IRA deduction ...................................................................2122 Student loan interest deduction .......................................................Reserved for future use ............................................................23 Archer MSA deduction ..............................................................24 Other adjustments:a Jury duty pay (see instructions)..................................... b Deductible expenses related to income reported on line 8l from the rental ofpersonal property engaged in for profit ............................... c Nontaxable amount of the value of Olympic and Paralympic medals and USOC prizemoney reported on line 8m ........................................ d Reforestation amortization and expenses .............................. e Repayment of supplemental unemployment benefits under the Trade Act of 1974.. f Contributions to section 501(c)(18)(D) pension plans ...................... g Contributions by certain chaplains to section 403(b) plans .................. h Attorney fees and court costs for actions involving certain unlawful discriminationclaims (see instructions)......................................... i Attorney fees and court costs you paid in connection with an award from the IRS forinformation you provided that helped the IRS detect tax law violations .........24a24b24c24d24e24f24g24h24ij Housing deduction from Form 2555.................................. k Excess deductions of section 67(e) expenses from Schedule K-1(Form 1041)..... z Other adjustments. List type and amount:24j24k24z2526 Total other adjustments. Add lines 24a through 24z .........................................Add lines 11 through 23 and 25. These are your adjustments to income. Enter here and on Form 1040,104SR, or 1040-NR, line 10.........................................................SchComplete Lance and Wanda Dean's Schedule 8812.Note: For Line 13, no Credit Limit Worksheet A has been provided. The necessaryamount is from Line 18 of Form 1040.SCHEDULE 8812(Form 1040)Department of the TreasuryCredits for Qualifying Childrenand Other DependentsAttach to Form 1040,1040-SR, or 1040-NR.Internal Revenue ServiceGo to www.irs.gov/Schedule8812 for instructions and the latest informaName(s) shown on returnLance H and Wanda B DeanPart I Child Tax Credit and Credit for Other Dependents1 Enter the amount from line 11 of your Form 1040,1040-SR, or 1040-NR ...........................2a Enter income from Puerto Rico that you excluded ........................2ab Enter the amounts from lines 45 and 50 of your Form 2555.................2bc Enter the amount from line 15 of your Form 4563........................2cd Add lines 2a through 2c .............................................................3 Add lines 1 and 2d .................................................................4 Number of qualifying children under age 17 with the required socialfill in the blanksecurity number 4b5d433f79fd0043_35 Multiply line 4 by $2,000.............................................................6 Number of other dependents, including any qualifying children who arenot under age 17 or who do not have the required social securityfill in the blanknumber ..............6b5d433f79fd0043_5Caution: Do not include yourself, your spouse, or anyone who is not a U.S. citizen, U.S. national, or U.S.resident alien. Also, do not include anyone you included on line 4.7 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} 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 nextmultiple of $1,000. For example, if the result is $425, enter$1,000; if the result is $1,025, enter $2,000, etc. }..............11 Multiply line 10 by 5%(0.05).........................................................12 Is the amount on line 8 more than the amount on line 11?..................................... No. STOP. You cannot take the child tax credit, credit for other dependents, or additional child tax credit.Skip Parts II-A and II-B. Enter -0- on lines 14 and 27. Yes. Subtract line 11 from line 8. Enter the result.13 Enter the amount from the Credit Limit Worksheet A .......................................14 Enter the smaller of line 12 or line 13. This is your child tax credit and credit for other dependents ...Enter this amount on Form 1040,1040-SR, or 1040-NR, line 19.If the amount on line 12 is more than the amount on line 14, you may be able to take the additional child tax cSR, or 1040-NR, line 28. Complete your Form 1040,1040-SR, or 1040-NR through line 27(also complete Sccompleting Part II-A.BAA For Paperwork Reduction Act Notice, see your tax return instructions. ScheduSchedule 8812(Form 1040)(2023) Lance H and Wanda B Dean 111-11-Part II-A Additional Child Tax Credit for All FilersCaution: If you file Form 2555, you cannot claim the additional child tax credit.15 Check this box if you do not want to claim the additional child tax credit. Skip Parts II-A and II-B. Enter -0- o16 Subtract line 14 from line 12. If zero, stop here; you cannot take the additional child tax credit. Skip Parts IIA and II-B. Enter -0- on line 27.......................................................b Number of qualifying children under 17 with the required social security number: \times $1,500.Enter the result. If zero, stop here; you cannot claim the additional child tax credit. Skip Parts II-A and II-B.Enter -0- on line 27...............................................................TIP: The number of children you use for this line is the same as the number of children you used for line 4.17 Enter the smaller of line 16a or line 16b ................................................18a Earned income (see instructions)....................................18aNontaxable combatpay (seebinstructions)...........18b19 Is the amount on line 18a more than $2,500? No. Leave line 19 blank and enter -0- on line 20. Yes. Subtract $2,500 from the amount on line 18a. Enter theresult .........1920 Multiply the amount on line 19 by 15%(0.15) and enter the result ..............................Next. On line 16b, is the amount $4,800 or more? No. If you are a bona fide resident of Puerto Rico, go to line 21. Otherwise, skip Part II-B and enterthe smaller of line 17 or line 20 on line 27. Yes. If line 20 is equal to or more than line 17, skip Part II-B and enter the amount from line 17 on line 27Otherwise, go to line 21.Part II-B Certain Filers Who Have Three or More Qualifying Children and Bona Fide Residents o21 Withheld social security, Medicare, and Additional Medicare taxes from Form(s) W-2,boxes 4 and 6. If married filing jointly, include your spouse's amounts with yours. If youremployer withheld or you paid Additional Medicare Tax or tier 1 RRTA taxes, or if you area bona fide resident of Puerto Rico, see instructions .........2122 Enter the total of the amounts from Schedule 1(Form 1040), line 15; Schedule 2(Form1040), line 5; Schedule 2(Form 1040), line 6; and Schedule 2(Form 1040), line 13......................................................2223 Add lines 21 and 22.............................................23241040 and1040-SR filers: Enter the total of the amounts from Form 1040 or 1040-SR, line27, and Schedule 3(Form 1040), line 11. Enter the amount from Schedule 3(Form 1040), line 11.}1040-NR filers: 2425 Subtract line 24 from line 23. If zero or less, enter -0-.......................................26 Enter the larger of line 20 or line 25...................................................Next, enter the smaller of line 17 or line 26 on line 27.Part II-C Additional Child Tax Credit27 This is your additional child tax credit. Enter this amount on Form 1040,1040-SR, or 1040-NR, line28...........................................................................ScheduUse the 2023 Tax Rate Schedules to compute the tax. (Note: Because the tax rate schedulesare used instead of the tax tables, the amount of tax computed may vary slightly fromthe amount listed in the tables.)2023 Tax Rate SchedulesSingleSchedule X Head of householdSchedule ZIf taxableof theIf taxableincome is:But notamountincome is:But notOverover The tax is:overOverover T$ 0 $ 11,000......10% $ 0 $ 0 $ 15,70011,00044,725 $ 1,100.0012%11,00015,70059,850 $ 1,44,72595,3755,147.0022%44,72559,85095,3506,95,375182,10016,290.0024%95,37595,350182,10014,182,100231,25037,104.0032%182,100182,100231,25035,231,250578,12552,832.0035%231,250231,250578,10051,578,125......174,238.2537%578,125578,100......172,Married filing jointly or Qualifying widow(er)Schedule Y-1 Married filing separatelyScheduleIf taxableof theIf taxableincome is:But notamountincome is:But notOverover The tax is:overOverover T$ 0 $ 22,000......10% $ 0 $ 0 $ 11,00022,00089,450 $ 2,200.0012%22,00011,00044,725 $ 1,89,450190,75010,294.0022%89,45044,72595,3755,190,750364,20032,580.0024%190,75095,375182,10016,364,200462,50074,208.0032%364,200182,100231,25037,462,500693,750105,664.0035%462,500231,250346,87552,693,750......186,601.5037%693,750346,875......93,