Using 2019 IRS forms and the information below, William is 53 and Joyce is 51. They are married. William is a manager for ABC Corporation, a firm that manufactures and distributes widgets. Joyce is a self-employed author of childrens books. The taxpayer wish to minimize their tax by deferring income and accelerating deductions when possible.

1. William began work on his MBA at University. He enrolled in two courses and paid $4,000 in tuition.

2. William and Joyce each contribute the maximum to their respective IRA accounts for the year. The IRA account is Joyces only retirement vehicle. In addition, William and Joyce contributed $2,000 to a Coverdell Education Savings Account for Tom(son age16).

3. In June the taxpayers 2012 station wagon is totaled during a hurricane. The car was purchased for $28,700. The taxpayers received a check for $21,200 from Insurance Company that represents the fair market value of the car minus a $750 deductible and they replaced the car with a new car costing $31,400.