November $23,2024$

Red Wolf CPA Services

$255$ Hayes Way

Richmond, IN $47374$

Dear Red,

Please let me introduce myself. I am David McAndrew. I moved to the United States

from the Cayman Islands with my wife Margaret at the beginning of the year. I am

writing to seek advice about income taxation in the U$.$S$.$ and how it will be applied

to sources of income. Please identify my tax issues, the implications of our current

facts, and a tax plan that would legally reduce our taxable income.

Here are the facts that pertained before moving to the United States.

$$ In the Cayman Islands, we did not have an income tax.

$$ In the Cayman Islands, I entered into a life$-$time contract with my wife

indicating that all of my earnings from property, labor or services would be

split $50/50.$

$$ I operate a small landscaping business as a sole$-$proprietorship. When paid for

my labor or services, my customers pay me $(1)/(2)$ of the total bill and pay Margaret

the other $(1)/(2)$ of the total bill. My landscaping business does have contingent

liabilities associated with warrantied work.

$$ Margaret signed a life$-$time contract splitting $(1)/(2)$ of her earnings from labor,

services, or property.

o Margaret and I entered into this agreement to set spending limits in our

household. Neither of us is allowed to spend more than we have

individually earned after taxes.

$$ Margaret has proven to be more frugal than I.

o She invested $$1,000,000$ in private sector coupon bonds. These are

corporate bonds that pay six percent interest semi$-$annually on January $1$

and July $1.$ To collect the interest, you detach the coupon when it comes

due with your personal information and return mailing address.

$$ Margaret has a sister, Shannon, who lives in Connersville and is struggling

financially.

o To help Shannon, Margaret has detached the coupons from her corporate

bonds and given them to Shannon.

o Shannon will mail the coupons into the corporation and the corporation

will prepare and mail interest checks to Shannon.

o The interest from the coupon bonds

$$ Because I face some contingent liabilities associated with my business, we

plan to file married filing separately.

$$ I estimate that I will receive $$250,000$ for the labor and services I provide

as a landscape architect.

$$ The operating costs are $$75,000$ for this business.

$$ Margaret has been unsuccessful in finding employment in $2024$ and has no earned

income.

Sincerely,

David McAndrew help please here are the instructions