PROBLEM 2 Andeew (Andy) S and Sarah H. Clark are hwaslband and wife and live an 4112 Poxoe Drive, McKinney TX 7500 Andy is a retired peteoleum enginees, and Sarah is a pora artis. They choose to file a joint tax scourm each year . When he rotired at age 65S, Andy was chief of offshoee operations at Pelican Exploeation Coeporation While employed, Andy participated in Pelican's onnten ry qalined pensin, plan, to which he had "trbuted $20000 (in after ax dollars). Under one of the plan opsions, he chose a ldetime annuity payout of $60,000 per year over his life. As pant of his retirement package, Andy also received nontaxable health insurance coverage for him and Sarah. Due to Andy's expenise in Gulf of Mexico offshore operations, Pelican eontinues bo use his services on consolking hasis (see hem 3 belom) 2. Sarah, an accomplished antist, is well known regionaltly for oid ponraits Cousiness activity code 711310) she painss in the Phosnrraliam sayle, peoviding her elients with portraits that are often mistaken for phosographs. Painting in this style is very time-consuming Consequendly, her ourput averages between 15 and 16 portralts year. Her fee of $3,200 per portrak was set several years ago and never varies A this is quite reasonable for a Photorealistic odl portrait, she has a long waiting is of clients who have not yet been scheduled for sittings She does all of her work in the studio the Clarks maintain in their personal residence (see inem 6 below) Sarah is a cash-basis taxpayer with respect to her at business 3. During 2017, Andy made seven trips on behalf of Pelican as an outside consultant business activity code 541330). On a typical trip, Andy flies by commercial airline to New Oleans, Houston, or Corpus Chrisei and then takes a company helicopser to the offishore platform. If necessary, he rents a soom at a local motel. Sometimes offsite consultations can solve the problem, and a trip to the rig is not necessary His expenses for these trips are as follows these trips are as follows $5,100 ,100 2.300 Lodging Ground transportation ttaxit, lmos, rental cars) After each trip, Andy recovers his expenses when he is paid by Pelican for the services rendered. Pelican does not require an accounting for the expenses and reimburses Andy based on his verbal report of how much he spent 4. In early January 2017, Sarah was paid for three portraits she painted and dellvered in late 2016. During 2017, Sarah completed 14 pontraits. Payment was received for 11 portraits when they were delivered to the buyers. One portrait was delivered in mid-2017 to the CEO of a company who promised payment within 30 days. Payment was never received, and the company has since entered bankruptcy. Since the CEO has been indicted for securities fraud, Sarah is certain that she will not be paid for the portrait. The final two portraits were delivered in late 2017, and payments for both were received in early 2018 In December 2017, Sarah accepted $3,200 as payment for a portrait to be done in 2018. Although she did not like the arrangement, the custoner said that the prepayment was motivated by anticipated cash-flow considerations. 5. Sarah keeps receipts for all of her expenses. Her total cost for painsing supplies in 2017 was $3,010 (e.g., for canvases, brushes, oll paints, smocks, palenes, and other art supplies). The framing of the finished potralt is left to the customer since the most appropriate frame is a matter of personal taste and consideration of where the painting will be exhibited. 6. For convenience and security reasons, Sarah prefers to work at bome. One-fourth of the 4,000-square-foot living area is devoted to Sarah's studio. The Clarks bail the home at a cost of $350,000 on a lot previously acquired for $100,000, and they moved in on June 15, 2014. As to business use, depreciation is based on MACRS (using the midmonth convention) applicable to 39-year nonresidential realty Besides home mortgage interest and property taxes (see item 19 below), residence expenses for 2017 are summarized below $4,200 Utilities Molly Maid cleaning service Service fee for home security system Removal of stains from studio flooring Homeowner's insurance Repairs to studlo skylight 2,800 1,600 1,100 970 340 7. At a mortgage foreclosure auction held on February 4, 2005, Andy acquired an ahandoned sugarcane farm near Magnolia, known as LaBeaux Place, for $30,000, APPENDIX E Practice Set Assignments-Comprehensive Tax Returm Probiems In view of the expansion trend in nearby Houston, he regarded the purchase as a good investment. Farly in 2017, Andy was contacted by a Houston real estate developer who offered $250,000 for Lableaux Place. Considering the prospect of a large taxable gain, Andy arranged for a property swap by written notice on May 10. In exchange for several vacant lots on Padre Island CXO worth $240,000 and cash of $10,000, Andly transferred LaBeaux Place to the developer. The exchange took place on June 20, 2017 8. Andy purchased unimproved land near Beaumont (TX) for $18,200 at an auction held on April 17, 1992 Described as Block 46, the property was adjacent to a modest prison rice farm owned by the Texas Department of Corrections (TDC) Andy bought the property based on a hunch that the TDC might someday want to expand its Beaumont prison facility. In late 2016, the TDC contacted Andy and offered him $160,000 for Block 46. Andy countered with a selling price of $225,000. After prolonged negotiations, Andy and the TDC could not come to a mutually agreeable selling price. The TDC then threatened to condemn Block 46. After repeated threats of condemnation, Andy transferred the property to the TDC on June 28, 2017, for $180,000. On December 17, 2017, Andy reinvested $175,000 in vacant land located near Texas State University in San Marcos. Andy spent the remaining $5,000 on a Hawalian vacation for him and Sarah in early 2018 9. The Clarks had always thought that taking extended road trips in an RV would be fun. So in June 2017, they bought a new Winnebago Deluxe Coach RV for $106,250 $100,000 (discounted list price) $6,250 (state sales tax)l However, it took Andy and Sarah only two weeks on the road to determine that this method of traveling the continental United States was not for them. In August 2017, they sold the RV to a neighbor for $90,000. The neighbor paid $20,000 down and paid the balance of $70,000 in early December 2017. Andy did not charge his neighbor any interest 10. On May 9, 2000, Andy's father gave him 400 shares of Ragusa Corporation common stock as a birthday gift. The stock cost his father $16,000 ($40 a share) and was worth $20,000 on the date of the gift. In 2012, when the stock was worth $140 per share, Ragusa declared a 2-for-1 stock split. On July 27, 2017, Andy sold 400 shares for $20,000 ($50 a share). For sentimental reasons, Andy kept the remaining 400 shares. Andy did not report the basis of this property on Form 1099-B. 11. On December 21, 2017, the Clarks sold 500 shares of Cormorant Power common stock for $40,000 (580 a share). They purchased the stock on February 1, 2017, for $50,000 ($100 a share), the basis reported on Form 1099-B. The Clarks sold the stock to generate a loss to offset some of their capital gains. However, because they considered Cormorant Power to be a good investment, they repurchased 500 shares on February 19, 2018, for $45,000 ($90 a share). 12. On March 2, 2016, Sarah was contacted by Eva Baum, a former college roommate. Over lunch, Eva asked Sarah for a loan of $6,000 to help finance a new venture. Sarah made the loan because the venture, a summer art camp in Sedona, AZ, sounded interesting. Eva signed a note due in two years at 10% interest. In late 2017, Sarah learned that Eva had disappeared after being charged by Arizona authorities with grand theft. She also leamed that Eva is wanted in New Mexico for parole violation from a prior felony conviction. Eva made no payments to Sarah on the note. 13. The Clarks have a long-term capital loss carryover of $7,000 from 2016. 14. On May 9, 2013, Maximilian Clark (Andy's favorite uncle) gifted him the family antique gun collection. Based on family records and qualified appraisals, the collection had an adjusted basis to Maximilian of $4,200 and was worth $13,000 the date of the gift. Since Sarah abhors guns, Andy has been under pressure to get rid of the collection. After Maximilian died in early 2017, Andy donated the collection to the Remember the Alamo Foundation. The transfer was made on APPENDIx E Practice Set December 5, 2017. At that time, several qualifed appraisers valued the collection at $16,000. The museum added the guns to iks extensive collection of firearms 15. While walking the dog in late December 2016, Sarah was hit by an out-of-control delivery truck. The mishap sent Sarah to the hospital for several days of observation and medical evaluation. Aside from severe bruises, she suffered no permanert injury. Once apprehended, the driver of the truck was ticketed for DUL. The owner of the truck, a local distributor for a national brewery, was concemed about the adverse publicity that would result if Sarah filed a lawsuit. Consequently, it paid all of her medical expenses and offered her a settlement if she would sign a release. Under the terms of the settlement, Sarah would receive $134,000, which was $126,000 for personal injury and $8,000 for loss of income because her injuries prevented her from painting for a period of weeks. On January 31, 2017, Sarah signed the release and was immediately paid $134,000. 16. In August 2016, Andy was rear-ended while stopped for a red light. Fortunately, Andy was uninjured. However, his car was damaged. The driver who caused the accident left the scene immediately, so Andy was forced to use his insurance to repair the damage to his car. As a result, Andy was subject to the $1,000 deductible provision in the policy, which he paid for his car repairs in 2016. The Clarks claimed no deductions on their 2016 income tax return with respect to the accident. In 2017, the insurance company (Peregrine Casualty) located the driver at fault and recovered the amount paid for repairs by both Andy and Peregrine. Consequently in April 2017, Andy received a check from Peregrine refunding the $1,000 he paid for repairs according to his policy's deductible. 17. After her acrimonious divorce, the Clarks' only child (Gabrielle Sparks) moved back home in December 2016. She brought her twins (Malone and Macie) with her. Under the divorce decree, Gabrielle was given custody of the children and awarded child support of $2,100 a month. The decree does not indicate who is entitled to the dependency exemptions for the children. Following the divorce, Gabrielle is taking some time to decide how to move forward with her life. She did not work in 2017, so she has no income for the year except the $4,200 she received for two months of child support. She plans to initiate legal proceedings against her ex-husband for delinquent child support. Subsequent to Gabrielle moving back home, Andy and Sarah provided all of Gabrielle's and the twins' support beyond the $4,200 received in child support. 18. Besides the items already mentioned, the Clarks have the folloving receipts for 2017 $18,000 Social Security benefits (Andy, $12,000, Sarah, $6,000) Consulting income pald by Pelican Oncluding expense 5,000 50,000 relmbursement of $11,150-see item 3) Life insurance proceeds (see below) Qualiffed dividend income (reported on separate Forms 1099-DIV 1,200 400 Ragusa Corporation Pelican Power Interest income (reported on separate Forms 1099-INT): I8M bonds CD at First National Bank of McKinney Wells Fargo money market fund City of Beaumont (TX) general purpose bonds 600 400 300 9,000 The life insurance proceeds concerned a policy owned by Maximilian Clark (see item 14), which named Andy as sole beneficiary. The receipt of the proceeds came as a complete surprise to Andy as he never knew the policy existed APPENDIX E Practice Set AssignmentsCompehenive Tae Returnm Problem 19. Payments made for 2017 expenditures not already mentioned are as follows: Payment of Gabrielle's legal fees and court costs incident to her divorce 9,000 Medicare B insurance premiums for Andy and Sarah 2,244 3,600 ,000 3,600 2.200 ,200 Health care premiums for dependents Dental implants for Sarah Taxes on personal residence Interest on home mortgage Cash donations to New Samaria Baptist Church, Mckinney. TX Professionall journals Oil- and gas-related (Andy) 160 Art-related (Sarah) Dues to professional organizations (Andyl State professional license fee (Andy) 2016 tax return preparation fee (5200 for Andy's business; $250 for 250 Sarah's business; $450 for personal income tax retum) Texas does not impose an income tax, so the Clarks choose the state and local sales tax option. In addition to the state general sales tax, the local sales tax rate is 2% (1% city: 1% community development. They do not keep track of sales tax expenditures for routine purchases (e.g., clothes, prepared foods) but can verify the sales tax on exceptional items Le, big-ticket purchases such as the RV). 20. The Clarks made quarterly Federal income tax payments of $2,400 on each of the following dates: April 17, 2017: June 15, 2017; September 15, 2017; and January 16, 2018. Last year's Federal income tax return reflected an overpayment of $800, which the Clarks chose to apply to their 2017 income tax liability. The trustee of Andy's retirement plan also withheld $6,500 of tax with respect to his retirement withdrawals for the year. Neither Andy nor Sarah holds any foreign financial accounts. Relevant Social Security numbers are noted below: Name Andrew S. Clark Sarah K. Clark Gabrielle Sparks Malone Sparks Macie Sparks Social Security Number 123-45-6785 123-45-6786 123-45-6784 123-45-6787 123-45-6788 Birth Date 09/15/1946 12/03/1951 10/19/1984 06/25/2011 06/25/2011 Requirements Prepare a 2017 income tax return (with all appropriate forms schedules) for the Clarks following these guidelines: Make necessary assumptions for information nor given in the problem but needed to complete the return. The Clarks are employing the same tax return preparer who completed their tax return for the prior year The taxpayers have substantiation (eg, records, receipts) to support all transactions for the year . If a refund is due, the Clarks want it applied to next year's tax liability. The Clarks do not want to contribute to the Presidential Election Campaign Fund PROBLEM 2 Andeew (Andy) S and Sarah H. Clark are hwaslband and wife and live an 4112 Poxoe Drive, McKinney TX 7500 Andy is a retired peteoleum enginees, and Sarah is a pora artis. They choose to file a joint tax scourm each year . When he rotired at age 65S, Andy was chief of offshoee operations at Pelican Exploeation Coeporation While employed, Andy participated in Pelican's onnten ry qalined pensin, plan, to which he had "trbuted $20000 (in after ax dollars). Under one of the plan opsions, he chose a ldetime annuity payout of $60,000 per year over his life. As pant of his retirement package, Andy also received nontaxable health insurance coverage for him and Sarah. Due to Andy's expenise in Gulf of Mexico offshore operations, Pelican eontinues bo use his services on consolking hasis (see hem 3 belom) 2. Sarah, an accomplished antist, is well known regionaltly for oid ponraits Cousiness activity code 711310) she painss in the Phosnrraliam sayle, peoviding her elients with portraits that are often mistaken for phosographs. Painting in this style is very time-consuming Consequendly, her ourput averages between 15 and 16 portralts year. Her fee of $3,200 per portrak was set several years ago and never varies A this is quite reasonable for a Photorealistic odl portrait, she has a long waiting is of clients who have not yet been scheduled for sittings She does all of her work in the studio the Clarks maintain in their personal residence (see inem 6 below) Sarah is a cash-basis taxpayer with respect to her at business 3. During 2017, Andy made seven trips on behalf of Pelican as an outside consultant business activity code 541330). On a typical trip, Andy flies by commercial airline to New Oleans, Houston, or Corpus Chrisei and then takes a company helicopser to the offishore platform. If necessary, he rents a soom at a local motel. Sometimes offsite consultations can solve the problem, and a trip to the rig is not necessary His expenses for these trips are as follows these trips are as follows $5,100 ,100 2.300 Lodging Ground transportation ttaxit, lmos, rental cars) After each trip, Andy recovers his expenses when he is paid by Pelican for the services rendered. Pelican does not require an accounting for the expenses and reimburses Andy based on his verbal report of how much he spent 4. In early January 2017, Sarah was paid for three portraits she painted and dellvered in late 2016. During 2017, Sarah completed 14 pontraits. Payment was received for 11 portraits when they were delivered to the buyers. One portrait was delivered in mid-2017 to the CEO of a company who promised payment within 30 days. Payment was never received, and the company has since entered bankruptcy. Since the CEO has been indicted for securities fraud, Sarah is certain that she will not be paid for the portrait. The final two portraits were delivered in late 2017, and payments for both were received in early 2018 In December 2017, Sarah accepted $3,200 as payment for a portrait to be done in 2018. Although she did not like the arrangement, the custoner said that the prepayment was motivated by anticipated cash-flow considerations. 5. Sarah keeps receipts for all of her expenses. Her total cost for painsing supplies in 2017 was $3,010 (e.g., for canvases, brushes, oll paints, smocks, palenes, and other art supplies). The framing of the finished potralt is left to the customer since the most appropriate frame is a matter of personal taste and consideration of where the painting will be exhibited. 6. For convenience and security reasons, Sarah prefers to work at bome. One-fourth of the 4,000-square-foot living area is devoted to Sarah's studio. The Clarks bail the home at a cost of $350,000 on a lot previously acquired for $100,000, and they moved in on June 15, 2014. As to business use, depreciation is based on MACRS (using the midmonth convention) applicable to 39-year nonresidential realty Besides home mortgage interest and property taxes (see item 19 below), residence expenses for 2017 are summarized below $4,200 Utilities Molly Maid cleaning service Service fee for home security system Removal of stains from studio flooring Homeowner's insurance Repairs to studlo skylight 2,800 1,600 1,100 970 340 7. At a mortgage foreclosure auction held on February 4, 2005, Andy acquired an ahandoned sugarcane farm near Magnolia, known as LaBeaux Place, for $30,000, APPENDIX E Practice Set Assignments-Comprehensive Tax Returm Probiems In view of the expansion trend in nearby Houston, he regarded the purchase as a good investment. Farly in 2017, Andy was contacted by a Houston real estate developer who offered $250,000 for Lableaux Place. Considering the prospect of a large taxable gain, Andy arranged for a property swap by written notice on May 10. In exchange for several vacant lots on Padre Island CXO worth $240,000 and cash of $10,000, Andly transferred LaBeaux Place to the developer. The exchange took place on June 20, 2017 8. Andy purchased unimproved land near Beaumont (TX) for $18,200 at an auction held on April 17, 1992 Described as Block 46, the property was adjacent to a modest prison rice farm owned by the Texas Department of Corrections (TDC) Andy bought the property based on a hunch that the TDC might someday want to expand its Beaumont prison facility. In late 2016, the TDC contacted Andy and offered him $160,000 for Block 46. Andy countered with a selling price of $225,000. After prolonged negotiations, Andy and the TDC could not come to a mutually agreeable selling price. The TDC then threatened to condemn Block 46. After repeated threats of condemnation, Andy transferred the property to the TDC on June 28, 2017, for $180,000. On December 17, 2017, Andy reinvested $175,000 in vacant land located near Texas State University in San Marcos. Andy spent the remaining $5,000 on a Hawalian vacation for him and Sarah in early 2018 9. The Clarks had always thought that taking extended road trips in an RV would be fun. So in June 2017, they bought a new Winnebago Deluxe Coach RV for $106,250 $100,000 (discounted list price) $6,250 (state sales tax)l However, it took Andy and Sarah only two weeks on the road to determine that this method of traveling the continental United States was not for them. In August 2017, they sold the RV to a neighbor for $90,000. The neighbor paid $20,000 down and paid the balance of $70,000 in early December 2017. Andy did not charge his neighbor any interest 10. On May 9, 2000, Andy's father gave him 400 shares of Ragusa Corporation common stock as a birthday gift. The stock cost his father $16,000 ($40 a share) and was worth $20,000 on the date of the gift. In 2012, when the stock was worth $140 per share, Ragusa declared a 2-for-1 stock split. On July 27, 2017, Andy sold 400 shares for $20,000 ($50 a share). For sentimental reasons, Andy kept the remaining 400 shares. Andy did not report the basis of this property on Form 1099-B. 11. On December 21, 2017, the Clarks sold 500 shares of Cormorant Power common stock for $40,000 (580 a share). They purchased the stock on February 1, 2017, for $50,000 ($100 a share), the basis reported on Form 1099-B. The Clarks sold the stock to generate a loss to offset some of their capital gains. However, because they considered Cormorant Power to be a good investment, they repurchased 500 shares on February 19, 2018, for $45,000 ($90 a share). 12. On March 2, 2016, Sarah was contacted by Eva Baum, a former college roommate. Over lunch, Eva asked Sarah for a loan of $6,000 to help finance a new venture. Sarah made the loan because the venture, a summer art camp in Sedona, AZ, sounded interesting. Eva signed a note due in two years at 10% interest. In late 2017, Sarah learned that Eva had disappeared after being charged by Arizona authorities with grand theft. She also leamed that Eva is wanted in New Mexico for parole violation from a prior felony conviction. Eva made no payments to Sarah on the note. 13. The Clarks have a long-term capital loss carryover of $7,000 from 2016. 14. On May 9, 2013, Maximilian Clark (Andy's favorite uncle) gifted him the family antique gun collection. Based on family records and qualified appraisals, the collection had an adjusted basis to Maximilian of $4,200 and was worth $13,000 the date of the gift. Since Sarah abhors guns, Andy has been under pressure to get rid of the collection. After Maximilian died in early 2017, Andy donated the collection to the Remember the Alamo Foundation. The transfer was made on APPENDIx E Practice Set December 5, 2017. At that time, several qualifed appraisers valued the collection at $16,000. The museum added the guns to iks extensive collection of firearms 15. While walking the dog in late December 2016, Sarah was hit by an out-of-control delivery truck. The mishap sent Sarah to the hospital for several days of observation and medical evaluation. Aside from severe bruises, she suffered no permanert injury. Once apprehended, the driver of the truck was ticketed for DUL. The owner of the truck, a local distributor for a national brewery, was concemed about the adverse publicity that would result if Sarah filed a lawsuit. Consequently, it paid all of her medical expenses and offered her a settlement if she would sign a release. Under the terms of the settlement, Sarah would receive $134,000, which was $126,000 for personal injury and $8,000 for loss of income because her injuries prevented her from painting for a period of weeks. On January 31, 2017, Sarah signed the release and was immediately paid $134,000. 16. In August 2016, Andy was rear-ended while stopped for a red light. Fortunately, Andy was uninjured. However, his car was damaged. The driver who caused the accident left the scene immediately, so Andy was forced to use his insurance to repair the damage to his car. As a result, Andy was subject to the $1,000 deductible provision in the policy, which he paid for his car repairs in 2016. The Clarks claimed no deductions on their 2016 income tax return with respect to the accident. In 2017, the insurance company (Peregrine Casualty) located the driver at fault and recovered the amount paid for repairs by both Andy and Peregrine. Consequently in April 2017, Andy received a check from Peregrine refunding the $1,000 he paid for repairs according to his policy's deductible. 17. After her acrimonious divorce, the Clarks' only child (Gabrielle Sparks) moved back home in December 2016. She brought her twins (Malone and Macie) with her. Under the divorce decree, Gabrielle was given custody of the children and awarded child support of $2,100 a month. The decree does not indicate who is entitled to the dependency exemptions for the children. Following the divorce, Gabrielle is taking some time to decide how to move forward with her life. She did not work in 2017, so she has no income for the year except the $4,200 she received for two months of child support. She plans to initiate legal proceedings against her ex-husband for delinquent child support. Subsequent to Gabrielle moving back home, Andy and Sarah provided all of Gabrielle's and the twins' support beyond the $4,200 received in child support. 18. Besides the items already mentioned, the Clarks have the folloving receipts for 2017 $18,000 Social Security benefits (Andy, $12,000, Sarah, $6,000) Consulting income pald by Pelican Oncluding expense 5,000 50,000 relmbursement of $11,150-see item 3) Life insurance proceeds (see below) Qualiffed dividend income (reported on separate Forms 1099-DIV 1,200 400 Ragusa Corporation Pelican Power Interest income (reported on separate Forms 1099-INT): I8M bonds CD at First National Bank of McKinney Wells Fargo money market fund City of Beaumont (TX) general purpose bonds 600 400 300 9,000 The life insurance proceeds concerned a policy owned by Maximilian Clark (see item 14), which named Andy as sole beneficiary. The receipt of the proceeds came as a complete surprise to Andy as he never knew the policy existed APPENDIX E Practice Set AssignmentsCompehenive Tae Returnm Problem 19. Payments made for 2017 expenditures not already mentioned are as follows: Payment of Gabrielle's legal fees and court costs incident to her divorce 9,000 Medicare B insurance premiums for Andy and Sarah 2,244 3,600 ,000 3,600 2.200 ,200 Health care premiums for dependents Dental implants for Sarah Taxes on personal residence Interest on home mortgage Cash donations to New Samaria Baptist Church, Mckinney. TX Professionall journals Oil- and gas-related (Andy) 160 Art-related (Sarah) Dues to professional organizations (Andyl State professional license fee (Andy) 2016 tax return preparation fee (5200 for Andy's business; $250 for 250 Sarah's business; $450 for personal income tax retum) Texas does not impose an income tax, so the Clarks choose the state and local sales tax option. In addition to the state general sales tax, the local sales tax rate is 2% (1% city: 1% community development. They do not keep track of sales tax expenditures for routine purchases (e.g., clothes, prepared foods) but can verify the sales tax on exceptional items Le, big-ticket purchases such as the RV). 20. The Clarks made quarterly Federal income tax payments of $2,400 on each of the following dates: April 17, 2017: June 15, 2017; September 15, 2017; and January 16, 2018. Last year's Federal income tax return reflected an overpayment of $800, which the Clarks chose to apply to their 2017 income tax liability. The trustee of Andy's retirement plan also withheld $6,500 of tax with respect to his retirement withdrawals for the year. Neither Andy nor Sarah holds any foreign financial accounts. Relevant Social Security numbers are noted below: Name Andrew S. Clark Sarah K. Clark Gabrielle Sparks Malone Sparks Macie Sparks Social Security Number 123-45-6785 123-45-6786 123-45-6784 123-45-6787 123-45-6788 Birth Date 09/15/1946 12/03/1951 10/19/1984 06/25/2011 06/25/2011 Requirements Prepare a 2017 income tax return (with all appropriate forms schedules) for the Clarks following these guidelines: Make necessary assumptions for information nor given in the problem but needed to complete the return. The Clarks are employing the same tax return preparer who completed their tax return for the prior year The taxpayers have substantiation (eg, records, receipts) to support all transactions for the year . If a refund is due, the Clarks want it applied to next year's tax liability. The Clarks do not want to contribute to the Presidential Election Campaign Fund