Schedule B Schedule C Richard Stockton College Of
Prepare the Federal Income Tax for Year 2019
Information for Tax Year 2019
Taxpayer Names:Neal and Carolyn Cassady
29 Russell Street
San Francisco, CA 94109
Filing Status: Married Filing Jointly
Dependents:
Cathy – Daughter, 20 years old – full time student at the University of Santa Clara
Jami – Daughter, 17 years old
John – Son, 15 years old
Other
A friend Jack Kerouac (age 49) lived with the Cassady’s for the entire year 2018. He did not pay any rent to the Cassady’s. He earned $32,000 in Taxable Income from royalties received from a book that he authored.
Social Security Numbers:
Neal (age 49) – 186-64-0027
Carolyn (age 49) – 154-10-6643
Cathy – 207-30-7807
Jami – 207-40-8081
John – 207-40-6625
Wages:
Neal – Wages from Southern Pacific Railroad – $82,540
Federal Income Tax Withheld on Neal’s Form W2 – $7,776
State & Local Income Taxes Withheld on Neal’s Form W2 – $3,205
Occupation – Brakeman
Sole Proprietor
Carolyn – (See information for Schedule C below)
Occupation – Self Employed
Interest Income: Bank of Santa Fe – $557
Dividend Income: Apple Inc. – $1,530 (Non-Qualified Dividend)
Trieste Coffee Company – $360 (Non-Qualified Dividend)
Schedule C information
Proprietor – Carolyn Cassady, Uses her own Social Security Number
Office Address: Home Office – 29 Russell Street, San Francisco, CA 94109
Principal Business: Author
Business Name – “The First Third Company”
Accounting Method: – Cash Basis
Materially Participated in Business – “Yes”
Business Started in 2012
Proprietor made no payments that would require filing Form 1099
Gross Receipts
(Royalties on Sales of Books): $58,234
Business Expenses:
Advertising – $302
Auto Expenses
4,305 business miles driven in 2019 (assume that Carolyn is using the mileage method)
Liability Insurance: $3,810
Legal Fees: $800
Credit Card Interest: $317
Office Expenses: $6,005
Travel Expenses:
Business trip 4 days
Roundtrip Airfare to New York City from San Francisco $870
Hotel 4 nights ($280 per night)
Uber – Airport/Hotel $70
Meals & Entertainment (business related) – $670
Business Entertainment – $195
Other Expenses
Annual Dues to the Vesuvio Cafe (Exclusive Dinner Club) in San Francisco: $200
Membership to City Lights Bookstore’s Writer’s Guild (A professional Organization) $80
Internet Charges: $2,315
Cell Phone Charges: $1,245
Home Office Expenses:
Carolyn uses the Simplified Method
Total Square footage of home – 2,300 feet
Business Office Square footage -250 feet
Personal Expenses:
Child Support paid to Neal’s first wife LuAnne Henderson – $13,200
Divorce on 11/15/14. LuAnne’s Social Security number is 147-69-8829
Real Estate Taxes – $8,210
Medical Expenses:
Prescription Drugs – $605
Health Care Premiums paid by Neal – $7,210
Non-Prescription Drugs
Advil – $35
Foot Cream for Athlete’s Foot – $9
Benadryl for Allergic Reaction for Bee Stings – $15
Insulin – $350
Heating Pad for back injury – $18
Doctors Bills – $1,660
Eyeglasses – $250
Orthodontist Fee for Braces for Jami – $1,600 (received bill in 2019 but not paid until 2020)
Family Membership to Health Fitness Club – $1,050
Physical Therapy for Carolyn for injured knee (Prescribed by Doctor) $370
Mortgage Interest – $16,115
Personal Credit Card Interest – $427
Interest on Personal Auto Loan – $1,660
Charitable Contributions:
American Cancer Society – $350
United Way – $60
Church of Saints Peter & Paul – $520
Rental Property
242 Marine Way
Stinson Beach, CA 94970
Rented 365 days (no personal use)
Single Family Residence
Rental Income $36,000
Rental Expenses
Auto Expenses $420
Cleaning & Maintenance $1,770
Commissions $1,440
Insurance $2,050
Mortgage Interest $15,176
Real Estate Taxes $4,350
Utilities $2,124
Depreciation $13,710
Estimated Tax Payment paid by Carolyn in 2019- $2,800
Required:
Prepare the Federal Tax Return for Neal and Carolyn Cassady for the Tax Year Ended December 31, 2019
Forms needed to prepare the Tax Return:
Form 1040
Schedule A
Schedule B
Schedule C
Schedule E
Schedule SE
Schedule 1