Complete the 2019 federal income tax return for the Davis family.  Ignore the requirement to attach the form(s) W-2 to the front page of the Form 1040.  If required information is missing, use reasonable assumptions to fill in the gaps.  Supply fictitious information for the address, occupations, Social Security numbers and children’s names.

Key items to note:

1. The forms must be completed “by hand”.  This means, either printed and written in, or typed in using the editable PDF format.  You cannot use tax software for the tax return assignments!
2. This assignment must be e-mailed to me with our graduate assistant, Michael, copied prior to the start of class on Wednesday, Oct. 14
   1. If it is late, your grade will be reduced by 10% per day up to a maximum of 50%
3. Lines with no data do not require a “0” to be written in and can be left blank
4. There is no need to complete the ‘sign here’ or ‘paid preparer use only’ sections as they will not be graded

Details

Charles D. and Alice A. Davis were married during all of 2019 and had income from the following sources:

            

Salary, Charles                                                              $87,100

            Federal income tax withheld                                          3,425

            Part-time salary, Alice                                                    16,700

            Federal income tax withheld                                         880

            Interest from Bank of America savings account              320

            Interest from U.S Federal Government Bonds                430

Charles (age 48) and Alice (age 48) provide the sole support of their two children (both under age 17). During the year, they paid job-related child care expenses of $2,200. Their itemized deduction for the year are insufficient for them to itemize, but a deductible $2,000 was deposited in each of their individual retirement accounts.  The Davis’ are fortunate to have full-year health coverage through Charles’ employer.

Calculate the Federal income tax and the tax due (or refund) for Mr. and Mrs. Davis, assuming they file a joint return. The Davis’ do not want to contribute to the Presidential campaign fund.  

To simplify the calculation, assume that $440 is the credit for children and dependent care expenses as calculated on Form 2441, Line 11.  Use the 2019 amount for the standard deduction. Also use the 2019 tax tables.

Answer rating: 100% (QA)

Answer Charles D and Allice A Davis COMPUTATION OF TOTAL INCOME FOR 2019 Note Salary Income Charles ... View the full answer