Tax Return-Individual Number Two three (after Chapter 7)-Bob and Melissa Grant

Tax Return-Individual TNumber Two hree (after Chapter 7)Instructions:Please complete the required federal individual income tax return forms for the followingtaxpayer. Unless instructed otherwise, the information provided is for the taxpayer’s 2012 taxyear. Please complete his 2012 tax return. Ignore the requirement to attach the form(s) W-2 tothe front page of the Form 1040. If required information is missing, use reasonable assumptionsto fill in the gaps.Bob and Melissa Grant are married and live in Lexington, Kentucky. The Grants have twochildren Jared age 15 and Alese age 12. The Grants would like to file a joint tax return for theyear.The following information relates to the Grant’s tax year:••••••Bob’s Social Security number is 987-45-1234Melissa’s Social Security number is 494-37-4893Jared’s Social Security number is 412-32-5690Alese’s Social Security number is 412-32-6940The Grants’ mailing address is 95 Hickory Road, Lexington, Kentucky 40502.Jared and Alese are tax dependents for federal tax purposesBob Grant received the following during the year:EmployerNational StorageLexington LittleLeagueGross Wages$66,200$2,710Federal Income TaxWithholding$8,0000State Income TaxWithholding$3,7500Melissa Grant received the following during the year:EmployerGross WagesJensen Photography$24,500Federal Income TaxWithholding$2,450State Income TaxWithholding$1,225All applicable and appropriate payroll taxes were withheld by Grants’ respective employers.The Grants also received the following during the year:Interest Income from First Kentucky BankInterest Income from City of Lexington, KY BondInterest Income from U.S. Treasury Bond$130$450$675Interest Income from Nevada State School Board BondWorkers’ Compensation payments to Bob$150$4,350Disability payments received by Bob on account of injury$3,500• National Storage paid 100% of premiums the premiums on the policy andincluded the premium payments in Bob’s taxable wagesReceipt of payment by Melissa as a result of a lawsuit for damages sustained in a caraccident:• Medical Expenses$2,500• Emotional Distress$12,000• Punitive Damages$10,000Total$24,500Eight years ago, Melissa purchased an annuity contract for $88,000. This year, she received herfirst payment on the annuity. The payment amount was $15,000. The annuity started to pay onJanuary 1 and she received a full first year’s payment. It will pay her $15,000 per year for tenyears (beginning with this year). The $15,000 payment was reported to Melissa a form 1099-Rfor the current year (box 7 contained an entry of “7” on the form).The Grants did not own, control or manage any foreign bank accounts nor were they a grantor orbeneficiary of a foreign trust during the tax year.The Grants paid or incurred the following expenses during the year:Dentist/Orthodontist (unreimbursed by insurance)$8,500Doctors (unreimbursed by insurance)$ 625Prescriptions (unreimbursed by insurance)$ 380KY state tax payment made on 4/15/13 for 2012 liability$1,350Real property taxes on residence$1,800Vehicle property tax based upon age of vehicle$250Mortgage interest on principal residence$8,560Interest paid on borrowed money to purchase the City ofLexington, KY municipal bonds$400Interest paid on borrowed money to purchaseU.S. Treasury bonds$240Contribution to the Red Cross$1,000Contribution to Senator Rick Hartley’s Re-election Campaign$2,500Contribution to First Baptist Church of Kentucky$6,000Fee paid to Jones & Company, CPAs for tax preparation$200In addition, Bob drove 6,750 miles commuting to work and Melissa drove 8,230 milescommuting to work. Both the Grants have represented to you that they maintained careful logsto support their respective mileage.The Grants drove 465 miles in total to receive medical treatment at a hospital in April.During the year, the Grants’ personal residence was burglarized on October 1 of the current year.The theft occurred during the day while both the Grants were at work and their children were atschool. The Grants had the following personal property stolen:ItemPurchase DateFair Value onDate of TheftTax Basis ofItemLaptop computerand PrinterRifleTV/Projector2005 Honda PilotTotal09/01/20123,0003,000InsuranceReimbursementReceived50003/01/201003/01/201007/01/20112,0005,0004,00014,0002,50013,0006,50025,0005001,0005002,500The Grants want to contribute to the Presidential Election Campaign. The Grants would like toreceive a refund (if any) of any tax they may have overpaid for the year. Their preferred methodof receiving the refund is by check.