BUS 261 Tax Return Two Scenarios

COMPREHENSIVE PROBLEM 6With Emphasis on Schedule DDebra Simon is a single taxpayer. She is employed as a corporate attorney and lives at 1400 Sand Dollar Circle,Sandville, FL 33172. Her social security number is 412-34-5670.For tax year 2013, Debra had the following income information:Debra had the following stock transactions during 2013. A 1099-B was received for the proceeds of each sale:Debra also sold her wine collection for $38,000. She had purchased the wine more than fiveyears ago on various dates for $19,000.Debra has a capital loss carryover from 2012 of $11,700: $3,000 short-term and $8,700 longterm.Debra rents a condo (no mortgage interest) and lives in Florida (no state income tax). Thus sheclaims the standard deduction.Required:Required: Complete the 2013 tax return for Debra Simon. You do not need to complete theloss carryover worksheet but do need to enter the carryover amount in the appropriate place onSchedule D. She wants to contribute to the presidential election campaign and does not wantanyone to be a third-party designee. For any missing information, make reasonableassumptions.COMPREHENSIVE PROBLEM 7With Emphasis on Schedule EChris and Stefani Watanabe live with their two boys at 1400 Victoria Lane, Riverside, CA 92501.Chris is an accountant who has his own accounting practice. Stefani is an elementary schoolteacher. Their sons, Justin and Jordan, are ages 12 and 9, respectively. The following isadditional information regarding the Watanabes.Social security numbers for the Watanabe family:Chris 412-345670Stefa 412-34ni5671Justin 412-345672Jorda 412-34n5673They paid $4,500 to Friendly Hills Child Care center for after-school care for both Justin andJordan, allocated equally.Stefani’s W-2 from the Riverside school district showed the following:Chris’s accounting business is located in downtown Riverside. His business had the followingincome and expense information for the year:Gross revenues$165,000Expenses:Advertising$ 2,100Insurance1,200Legal fees10,500Office supplies800Rent24,000Travel6,945Mealsentertainment2,400Utilities2,800Wages34,000Dues650Additionally, Chris and Stefani paid the following expenses during the year:Medical and dental expenses$4,500Property tax (home on Victoria Lane)3,750State income taxes3,900Donations to the church (cash)3,500Tax return preparation800Mortgage interest (home on VictoriaLane)14,900Chris and Stefani also earned $975 of interest income from California Bank during the year.Page B-8Lastly, Chris and Stefani own a 3-bedroom cabin in Big Bear Lake (they bought it in 2003). Theaddress is 3105 Stonehedge Road, Big Bear Lake, CA 92315. They did not use the property forpersonal use at any time during the year. The revenue and expenses for the Big Bear Lakerental property are as follows:Rental income$18,000Expenses:Insurance$1,200Property taxes2,500Auto (standardmileage)267Management fees1,600Repairs andmaintenance1,100Mortgage interest9,000Depreciation960Utilities450The Watanabes also made $18,000 and $7,000 in federal and California estimated income taxpayments, respectively, during the year.Required:Required: Prepare the Watanabes’ federal tax return for 2013. Use Form 1040, Schedule A,Schedule C, Schedule E, Schedule SE, and any additional schedules or forms they may need.They want to contribute to the presidential election campaign, and they do not want anyone tobe a third-party designee. For any missing information, make reasonable assumptions.