Please complete the 2019 Form 1040 (Stop after completing Line 12a, round up to the nearest dollar),
Schedule-1 and Schedule A for the taxpayer:
Julie Anderson is a project manager and her wage is 74,300. Julie's father passed away on April 14. She inherited her father’s cottage (vacation home) in Montana and 80,000 cash. She used the 80,000 to invest in an annuity product that pays her $ 10,000 per year for the next 10 years. The first yearly payment ($10,000) was received on December 15th, 2019
Her 2019 filing status is Single. She also has the following items for 2019:
Interest income from:
Capital One 200
City of San Francisco municipal bond 600
US Treasury bond. 800
Ordinary dividends from her investment in Wells Fargo… 400. All the dividends are qualified for the 15% tax rate.
She also bought 50 shares Apple Inc. stock (AAPL) when the price was $100 per share. AAPL's market closing price for December 2019 is $250 per share. No shares were sold during the year.
During the year she went to Wynn Las Vegas and won $ 1,300 in a poker game. However, she lost $2,000 at another casino.
She received $4,000 insurance payout from AFLAC. The insurance policy was bought by herself.
She has the following refunds and withholdings in 2019, and took the standard deduction on her 2018 federal tax return.
California state income tax refund……… 250
State income tax withheld from her paycheck…………………. .4200
Federal income tax withheld from her paycheck………………. 9000
Social security tax paid as an employee............. 5340
She owns and lives in her house in Fresno, CA and has the following expenses:
Home mortgage loan interest………………… 8700
Home mortgage loan points (not reported on Form 1098)….. 200
Real estate tax on her house………………… 4000
Personal-use car loan interest……………….. 2000
She also paid 2000 of qualified student loan interest.
Ms. Anderson had a medical procedure and incurred qualified medical costs of $30,000. Her health insurance policy pays 80% of the medical cost and Julie paid the remaining 20% out of her own pocket.
Julie also wanted to ask you the following questions:
• Where/On which schedule can she deduct any utilities and insurance on the cottage if she rents out the vacation home for income next year?
• Can she deduct any fees paid to attorneys to execute her father’s will this year?
• Can she deduct any fees paid to you to prepare her tax return this year?
