The Park family consists of the following:
Jackie O. Park; age 40; SSN: XXX-XX-XXXX; business analyst; single; unmarried
Leslie T. Park; age 16; SSN: 000-00-0000; daughter; high-school student; lives at home
Alex K. Park; age 12; SSN: NNN-NN-NNNN; son; middle-school student; lives at home
Pertinent information:
Address: 132 Oakbrook Drive, Houston, Texas 77091
The Parks do not want to contribute to the presidential election campaign
Jackie does not receive child support. She pays all of the household expenses including the upkeep of Leslie and Alex. Only Jackie can claim Leslie and Alex as dependents.
Using the correct Tax Rate Schedule (Not to be confused with the IRS Tax Tables) calculate the tax payers Tax Liability
Jackie also operates a realty company on a part-time basis. Her income from this business is from real estate sales during the year. She is a sole proprietor and her companys name is Jaleal Realty Company. Jackie rents a small office to operate this business.
Jackie had the following earnings on her W-2:
Wages: $55,159
Federal tax withheld: $7,460
Social Security tax withheld: $3,420
Medicare tax withheld: $800
Jackie had the following income (as shown on Form 1099) and expenses from her business:
Total self-employment income reported on Form 1099 was $23,000 and came from the real estate commissions earned from home sales.
Business Expenses:
Rent
7,200
Travel expenses
2,200
Advertising
2,345
Supplies
955
Office expenses
750
Telephone
720
Internet expense
540
Broker license
75
Legal and professional
1,000
Miscellaneous
150
Other tax data:
Texas States general sales tax deduction allowed is $924.
Jackie received $610 of personal interest income from her bank.
She donated $230 in cash to her church during the year.
Real estate taxes paid on her personal residence were $1,980, and the mortgage interest paid to her bank in New York, NY on the primary residence for the year was $16,000.
Medical expenses for the family were as follows:
medical insurance premium $3,244
payments for doctors visits $1,760
$850 was paid for dentists
$230 for prescription drugs
Using the proper tax rate schedule for her filing status, calculate Jackies tax liability.
Assignment Guidelines
To prepare Jackie O. Park’s tax return without the aid of Tax preparation software, complete the following steps:
Ensure that you have an Adobe Reader http://get.adobe.com/reader/ installed on your computer to open and use the downloadable IRS forms.
Determine which forms are necessary for Jackie O. Park’s tax return.
Go to the IRS Web site and download the fill-in tax forms that you will need to complete: 1040, 1040 Schedule A, 1040 Schedule C and 1040 Schedule SE.
Complete all necessary downloaded fill-in forms on the computer and save.
