Phil and Kristy are married and file a joint return. They are both under age 50. They operate a small business. Gross income from the business was $150,000 and operating expenses were $70,000. In addition to the the operating expenses they incurred business travel costs, hotels $800, food while in travel status $300, cost of business related education $1,000 and business mileage on their vehicle of 2,500 miles on which they elect to use the automatic mileage method. They also took clients golfing $900, and took clients out to dinner $2,000, business was discussed while golfing and at dinner. Their business was operated out of their home. Total square footage allocated to the business was 500 square feet out of 3,000 square feet. They elect to use the simplified method for computing home office expense. They each elect to contribute the maximum to their traditional IRA's. They paid estimated taxes of $12,000 Compute their tax refund or tax due for 2021.

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fing for client 8900 PhiL and KriIsty Both Ihey are under 50 yr... View the full answer