I have a tax return project, and need help with it. I am going to upload the project. please follow all guidlines, and also tax forms needed from the IRS website. See file attached for all detials.
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AC 4141 Income Tax 1
Income Tax Project
Spring 2017
James Baker has hired you to prepare his 2016 U.S. Individual Income Tax Return. He has 2
children, George and Reagan who are 6 and 12 years of age respectively. James wife Liz
passed away on December 31, 2016. Ms. Mary Jones, Liz Baker’s mother, who is 67 years
old and blind, also lives with Mr. Baker. Ms. Jones only source of income for 2016 is $
3,500- that she received for appearing on the Dr. Phil Show. Mr. Baker provides more than
one half of Mary Jones support. Mr. Baker has provided you with the following information
to be used in preparing his 2016 Income Tax Return.
James reported the following information:
James’s social security number is 294-83-2845
Liz’s social- security number is 294-38 4528
George’s social security number is 824-84-8456
Reagan’s social security number is 824-48-6584
In-order for James to maintain a full-time job, he sends George to a day care program
afterschool 5 days a week. During the year, James paid the day care operator $ 6,500 for
Georges’s care.
The day care details are as follows:
Happy Day Care Solutions
123 Red State Road
Columbus Ga 30302
EIN-43-6598324
Salaries:
Liz Baker
James Baker
30,000
90,000
Interest Income
Exit Bank
Compass Bank
2,000
3,000
Dividend Income
Exxon Corporation
Ford Motor Company
The Dividends are ordinary and qualified.
4,500
2,500
James, who is a CPA for Cook and Cranford CPAs, is also pursuing a Law degree from
the University -of Georgia via distance learning. Total tuition paid during 2016 was
$6,100. Books cost $150.00
On July l, 2016 James started his own business — JB Bait and Tackle. The business is
a sole proprietorship. The•income and expenses for 2016 are as follows:
Gross Sales
145,000
Wages, Salaries, and Benefits (Employees)
34,000
Returns and allowances
3,000
Advertising
6,000
Rent expense
12,000
Legal Fees
4,000
Purchases
60,000
Inventory 12-31-1b
10,000
1-,200
Taxes and Licenses
Utilities
5,600
Insurance
3,000
Telephone
2,090
Mr. Baker has also provided you the following information:
Medical Expenses (James)
8,000
10,000
(Children)
6,400
(Mary Jones)
6,000
(Abbie the dog)
2,200
All of the-above medical expenses are in excess of insurance reimbursements and were
paid by James.
State Income Taxes
City of Auburn Tax
Property taxes on Personal Residence
Mortgage Interest on Personal
Contributions (cash and check)
33500
1,200
3,000
Residence 11,000
AU Foundafion
2,000
Lee County Humane Society
5,000
Mr. Baker’s- Sailboat was purchased in 2000 for $65,000. During 2016 Hun-icane
Seecore hit the panhandle of Florida where the boat was docked causing its complete
destruction (it was a total loss and there was no insurance on the boat). FMV of the
sailboat on the date it was destroyed was $10,000.
Federal Income taxes withheld from the Baker’s Salaries totaled 12,000.
. All forms and schedules needed for this
are available at www.irs.gov
You may use your book, the Internal Revenue Code, IRS publications.
This assignment is due by 12.’00pm Monday April 24th 20-16. No late projects will- be
-accepted-for any reason.
…
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