Instructions:<\/p>\n
Please complete the
\nrequired federal individual income tax return forms for Carlos
\nand Maria Gomez for the 2013 tax year. Ignore the requirement to attach the
\nForm(s) W-2 to the front page of the Form 1040. If required information is
\nmissing, use reasonable assumptions to fill in the gaps.<\/p>\n
Carlos and Maria
\nGomez live in Lubbock, Texas. The Gomezes have two children: Luis (age 14) and
\nAmanda (age 12). Both children qualify as federal income tax dependents of
\nCarlos and Maria. The Gomezes provided the following information:<\/p>\n
\u00e2\u0080\u00a2
\nLuis\u00e2\u0080\u0099s social
\nsecurity number is 589-24-8432
\n\u00e2\u0080\u00a2
\nAmanda\u00e2\u0080\u0099s
\nsocial security number is 599-74-8733
\n\u00e2\u0080\u00a2
\nThe Gomez\u00e2\u0080\u0099s
\ncurrent mailing address is 543 West La Patera, Lubbock, Texas 79401<\/p>\n
Carlos is a civil engineer. For the first two
\nmonths of the year, he was employed by West Texas Engineering (WTE). However,
\nhe resigned his position with WTE to start his own engineering firm called
\nGomez Professional Engineers (GPE). GPE is conducted as a sole proprietorship
\nwith Carlos being the sole owner. GPE started business on January 1, 2013 and
\nis located at 1515 West Industrial Road Lubbock, Texas 79401 (EIN 20-1616167).
\nMaria works for herself as a part-time bookkeeper.<\/p>\n
Carlos provided the following W-2 from WTE.
\n.jpg”><\/p>\n
Carlos reported the
\nfollowing information for GPE\u00e2\u0080\u0099s business activities (GPE uses the cash method
\nof accounting):<\/p>\n
Revenues:<\/p>\n
Credit card receipts<\/p>\n
$352,000<\/p>\n
Cash receipts<\/p>\n
648,000<\/p>\n
Total revenue<\/p>\n
$1,000,000<\/p>\n
Expenses:<\/p>\n
Advertising<\/p>\n
$5,450<\/p>\n
Insurance-professional<\/p>\n
15,750<\/p>\n
Office building rent<\/p>\n
62,000<\/p>\n
Equipment leases<\/p>\n
6,050<\/p>\n
Travel<\/p>\n
14,200<\/p>\n
Meals and entertainment<\/p>\n
2,975<\/p>\n
Wages<\/p>\n
498,725<\/p>\n
Taxes and licenses<\/p>\n
44,875<\/p>\n
Employee health insurance<\/p>\n
42,000<\/p>\n
Employee benefit programs<\/p>\n
14,500<\/p>\n
Utilities<\/p>\n
37,425<\/p>\n
Office supplies<\/p>\n
18,900<\/p>\n
Legal and professional fees<\/p>\n
15,550<\/p>\n
Repairs and maintenance<\/p>\n
10,000<\/p>\n
Total Expenses<\/p>\n
$ 788,400<\/p>\n
GPE purchased and placed in service the following fixed assets:<\/p>\n
Item<\/p>\n
Date
\n Purchased<\/p>\n
Amount<\/p>\n
Laptop computers<\/p>\n
March 1<\/p>\n
$20,500<\/p>\n
Printers<\/p>\n
June 1<\/p>\n
$6,500<\/p>\n
Office furniture<\/p>\n
October 10<\/p>\n
$19,000<\/p>\n
GPE does not want to claim any bonus depreciation or Section 179
\nexpensing on any of these assets.<\/p>\n
Carlos worked part-time on GPE business
\nactivities until he finished his employment with WTE early in the year. Carlos
\nworked full-time on GPE business activities for the rest of the year.<\/p>\n
GPE filed Forms 1099 for payments made to contractors when required to
\ndo so.<\/p>\n
Carlos and Maria paid $22,000 for health
\ninsurance for his family (for the time he was working at GPE). This amount is
\nnot included in the totals for GPE above. Neither Carlos nor Maria had access
\nto employer-provided health insurance during the year while they were paying
\nthe premiums for this policy.<\/p>\n
In need of cash, in February, Carlos withdrew
\n$20,000 from his 401(k) account. He received the following Form 1099-R:<\/p>\n
.gif”><\/p>\n
In addition, Carlos
\nhas established a SEP-IRA retirement plan using his business earnings from
\nGPE.. He would like to make the maximum contribution possible to this plan for
\nthe 2013 tax year. Assume that you will file this tax return by April 15 of
\n2014 and Carlos will be able to fund the SEP IRA with the full amount allowable
\nby the date he files the return.<\/p>\n
Maria received the following Form 1099-Misc from
\nher bookkeeping activities for her largest client:
\n.jpg”><\/p>\n
Maria received an
\nadditional $4,000 from clients who were not required to issue Maria a Form
\n1099.<\/p>\n
During the tax year, Maria paid the following
\nbusiness-related expenses:<\/p>\n
?<\/p>\n
Paper<\/p>\n
$365<\/p>\n
?<\/p>\n
Toner<\/p>\n
$450<\/p>\n
?<\/p>\n
Meals<\/p>\n
$580<\/p>\n
On March 1, 2013 Maria purchased a new laptop
\ncomputer for her business at a cost of $1,850. Maria also purchased a new laser
\nprinter\/photocopier combination at a cost of $840 on the same date. In April,
\nMaria purchased computer software to use in her business for $400. Maria would
\nlike to recover the cost of these assets as soon as possible.<\/p>\n
Maria owns a 2011
\nAcura. She started to use the Acura for her business on January 1, 2012. She
\ndrove 2,050 business miles during 2013 (she has documentation to verify). She
\ndrove the vehicle for a total of 10,000 miles during the year (7,950 personal
\nmiles). She also has access to another vehicle that she can use for personal
\npurposes.<\/p>\n
Maria started her bookkeeping service in 2010 and
\nshe uses the cash method of accounting. She is the only person performing
\nservices in the business. She did not make any payments that would have
\nrequired her to file a Form 1099.<\/p>\n
On January 3, 2013, the Gomezes sold their prior
\nprincipal residence. They purchased that residence in 2008 and had lived there
\nfull-time until they sold it this year. They originally purchased the home for
\n$310,000. The Gomez family has never claimed any tax depreciation (nor were
\nthey allowed to) on the home in any tax year. The sales price of the home was
\n$405,000. The home is located at 45 East Entrada Trail, Lubbock Texas 79401.<\/p>\n
The Gomez family
\npurchased (and moved into) their current residence at 543 West La Patera,
\nLubbock, Texas 79401 in late January of 2013. The La Patera residence is 2,000
\nsquare feet. The purchase price of the residence was $500,000 (building value
\nwas $350,000 and the lot value was $150,000). The mortgage on the purchase was
\n$300,000. Expenses relating to the La Patera residence were as follows:
\n.jpg”><\/p>\n
Property taxes<\/p>\n
$10,750<\/p>\n
Utilities<\/p>\n
$3,000<\/p>\n
Insurance<\/p>\n
$2,000<\/p>\n
In addition to the
\nprimary mortgage on the home, the Gomezes borrowed $150,000 on a home equity
\nline of credit (\u00e2\u0080\u009cHELOC\u00e2\u0080\u009d) against the La Patera home. They received the
\nfollowing Form 1098 relating to the line of credit:
\n.jpg”><\/p>\n
They used the funds from the line of credit
\nborrowed funds to pay off personal debts on credit cards, take a European
\nvacation, and to purchase two new personal vehicles.<\/p>\n
Maria utilized a room in the La Patera home for
\nher bookkeeping business. The room was used exclusively on a regular basis as
\nthe principal place of business for Maria\u00e2\u0080\u0099s business. Maria wants to maximize
\nher home office deduction related to this use. The room she uses is 200 square
\nfeet.<\/p>\n
In the summer of
\n2013, the Gomez family rented out the La Patera residence to another family.
\nThe La Patera residence is situated along the ninth green of the famous Lubbock
\nCountry Club (LCC). The LCC hosted the U.S. Senior Open golf tournament this
\nyear. The Gomez family rented their residence to a golfer participating in the
\nevent for $1,000 per day for 10 days (the home office remained locked and off
\nlimits to the renters, however). During this time the Gomez family went on
\nvacation touring the west coast of the United States. The Gomez family incurred
\n$1,500 of cleaning and other expenses associated with the 10-day rental period.<\/p>\n
Maria owns 20 acres of vacant ground within the
\ncity limits of Lubbock. Maria acquired the land as a gift from her parents on
\nJuly 1, 2006. The land was valued at $4,000 per acre on the date of the gift.
\nHer parents purchased the land in 1990 at a price of $500 per acre. Maria has
\nheld this land as an investment since she received it. On September 15, 2013
\nMaria exchanged this land with a development company that plans to develop the
\n20 acres (Maria and the development company are not related). In exchange for
\nthe 20 acres, Maria received a condominium in Lubbock that was valued at
\n$160,000. For purposes of depreciation, the building is valued at $120,000 and
\nthe land is valued at $40,000. The condominium is located at 990 El Mar, Unit
\nA, Lubbock Texas 79401.<\/p>\n
Maria first
\nrented out the El Mar unit on October 1, 2013. The revenue and expenses from
\nthe rental unit from October through December is as follows:<\/p>\n
Rental revenue<\/p>\n
$3,600<\/p>\n
HOA fee expense<\/p>\n
$300<\/p>\n
Property taxes paid<\/p>\n
$225<\/p>\n
Utilities expense<\/p>\n
$350<\/p>\n
No Form(s) 1099 were required to be filed for
\nthis rental.<\/p>\n
The Gomezes also received the following Forms
\n1099 for the year:
\n.jpg”><\/p>\n
The Grand Junction City bond was issued in 2008.
\n.jpg”><\/p>\n
.gif”><\/p>\n
The Lubbock Texas School District bond
\nwas issued in 2011.
\n.jpg”><\/p>\n
.gif”><\/p>\n
.gif”><\/p>\n
.gif”><\/p>\n
The Gomezes did not own, control, or manage any
\nforeign bank accounts nor were they a grantor or beneficiary of a foreign trust
\nduring the tax year.<\/p>\n
The Gomezes paid the following expenses during
\nthe year (in addition to the personal residence-related items listed above):<\/p>\n
Dentist (unreimbursed by insurance)<\/p>\n
$<\/p>\n
500<\/p>\n
Doctors (unreimbursed by insurance)<\/p>\n
$<\/p>\n
1,750<\/p>\n
Prescriptions (unreimbursed by insurance)<\/p>\n
$<\/p>\n
425<\/p>\n
Vehicle property tax based upon value<\/p>\n
$<\/p>\n
950<\/p>\n
Contribution to qualified charities<\/p>\n
$<\/p>\n
3,500<\/p>\n
The Gomezes did not pay any state individual
\nincome taxes during the year.<\/p>\n
Other Information<\/p>\n
The Gomezes made federal estimated tax payments
\nrelated to the 2013 tax year as follows during the current year:<\/p>\n
April 15, 2013<\/p>\n
$11,000<\/p>\n
June 15<\/p>\n
$11,000<\/p>\n
September 15<\/p>\n
$11,000<\/p>\n
January 15, 2014<\/p>\n
$11,000<\/p>\n
The Gomezes want to
\ncontribute to the Presidential Election Campaign. The Gomezes would like to
\nreceive a refund (if any) of tax they may have overpaid for the year. Their
\npreferred method of receiving the refund is by check.<\/p>\n","protected":false},"excerpt":{"rendered":"
Instructions: Please complete the required federal individual income tax return forms for Carlos and Maria Gomez for the 2013 tax year. Ignore the requirement to\u2026<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8827,10099,10540,10536,10892,10538,10539,10537,10891],"tags":[10549,10616,10615,7687,10627,8857,10552,10295,10548,10622,8907],"class_list":["post-130139","post","type-post","status-publish","format-standard","hentry","category-australia-essays","category-buy-essay","category-cheap-essay-writers","category-get-assignments-done","category-page-paper","category-phd-essay-writers","category-research-paper-writing-service-for-any-topic","category-study-bay-essay","category-write-my-assignment-ireland","tag-ai-plagiarism-free-essay-writing-tool","tag-australian-best-tutors","tag-best-trans-tutors","tag-buy-essay-uk","tag-cheap-dissertation-writer","tag-help-with-writing-an-essay","tag-help-write-my-paper-ai-free","tag-homework-for-you","tag-online-essay-writers","tag-phd-essays","tag-write-my-essay-for-me"],"_links":{"self":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts\/130139","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/comments?post=130139"}],"version-history":[{"count":0,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts\/130139\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/media?parent=130139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/categories?post=130139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/tags?post=130139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}