1. Suppose you are an EA with two clients that come to you for help with figuring out their taxable income. Based on the data in the links below, you must determine the federal taxable income for each client for tax year 2022.
2. Use an Excel document with two tabs: one for each client.
3. Label each tab with the client's name(s).
4. Compile your answers within the spreadsheet to show income minus above the line and below the line deductions to arrive at taxable income.

Client 1 is Mr. John Norris. He divorced Mrs. Jane Norris March 1, 2018. The divorce decree required Mr. Norris to make the following payments:

1. Title to the primary residence was transferred to Jane. The fair market value of the home is $225,000 and the basis is $175,000.
2. John must pay $1,600 per month mortgage payments on the house, which has 15 years remaining. The payments will end at Jane's death. John paid every month for tax year 2022.
3. John must pay $1,000 per month for 10 years in support payments to Jane, of which $400 per month is child support. John paid every month for tax year 2022.
4. Jane insisted that the children attend private schools. In 2022, John paid $1,800 in tuition for private high school.

In addition to the above, John owns an apartment complex. Each new tenant pays $850 for a security deposit, which is refundable upon vacating the apartment. In 2022, John collected $2,550 in security deposits and $16,000 in rental income. Ignore QBID in this problem.

John won first prize in a raffle in 2022. The prize is a new car with a window price of $22,000. John discovered that the car price is $20,000 when he checked around at multiple dealerships.

John makes $75,000 a year for his annual salary plus a bonus of $5,000 that would be received January 2023. John has itemized deductions of $25,900.

Client 2is Ben and Jamie Newton are a married couple that support Ben'sparentswho are in a nursing home. The parents are 70 years old and their only income is $10,700 social security, $2,000 interest income, and $1,200 dividend income.

Ben's annual salary is $56,000, and Jamie's annual salary is $41,000.

Jamie receives stock dividends of $400 from stock she owned prior to marriage. In addition, she received $250 in dividends from a life insurance policy that she owned prior to marriage as well.

The couple received $650 in interest income from their savings account and $100 interest from state government bonds.

Ben is a bookkeeper and negotiates with his dentist to do dental worth valued at $2,000 in exchange for $1,000 worth of bookkeeping services.

They had $28,000 in itemized deductions.