Daniel B. Butler and Freida C. Butler, assignment help


Daniel B. Butler and Freida C. Butler, husband and wife, file a joint
return. The Butlers live at 625 Oak Street Corbin, KY 40701. Dan’s social
security number is 111-11-1111, and Freida’s is 123-45-6789. Dan was born on
1/15/63 and Freida was born on 8/20/1964.

  During 2014, Dan and Freida furnished over half of the total support
of each of the following individuals, all of whom still live at home:

  a. Gina, their daughter, age 22, a full-time student, who married on
December 21, 2014, has no income of her own and for 2014 did not file a joint
return with her husband, Casey, who earned $10,600 during 2014. Gina’s social
security number is 123-45-6788.

  b. Sam, their son, age 20, who had gross income of $6,300 in 2014,
dropped out of college in October 2014. He had graduated from high school in
May 2014. Sam’s social security number is 123-45-6787.

  c. Ben, their oldest son, age 26, is a full-time graduate student
with gross income of $5,200. Ben’s social security number is 12304506786.

Dan was employed as a manager at WJJJ, Inc. (employer ID number is 11-111),
604 Franklin Street, Corbin KY 40702), and Freida was employed as a
sales-person for Corbin Realty, Inc. (employer ID number is 98-7654321, 899
Central Street, Corbin, KY 40701). Selected Information from the W-2 forms
provided by the employers is presented below. Dan and Freida use the cash

Line  Description  Dan  Freida

1  Wages, tips, other compensation  $74,000  $86,000

2  Federal Income tax withheld  $11,000  $12,400

17  State income tax withheld  $2,960  $3,440

Freida sold a house on 12/30/2014 and will be paid a commission of $3,100
(not included in the $86,000 reported on the W-2) on the January 10, 2015
closing date.

Other income (as reported on 1099 Forms) for 2014 consisted of the

Dividends on CSX stock (qualified)  $4,200

Interest on savings at Second Bank  1,600

Interest on City of Corbin bonds  900

Interest on First Bank CD  382

The $382 from First Bank was original issue discount. Dan and Freida
collected $16,000 on the First Bank CD that matured on September 30, 2014. The
CD was purchased on October 1, 2012, for $14,995, and the yield to maturity was

Dan received a schedule K-1 from the Falcon partnership, which showed his
distributive share of income as $7,000. In addition to the above, Dan and
Freida’s itemized deductions included the following:

Paid on 2014 Kentucky income tax  $700

Personal property tax paid  600

Real estate taxes paid  1,800

Interest on home mortgage (Corbin S&L) 4,900

Cash contributions to the Boy Scouts  800

Sales tax from the sales tax table is $1,860. Dan and Freida made Federal
estimated tax payments of $8,000. The Kentucky income tax rate is 4%.

Tax Computation:

Compute Dan and Freida’s 2014 Federal income tax payable (or refund due).

Using tax forms for your computations you will need 1040 and schedules A,
B, and E.

Attach separate document showing any work done in order
to complete forms

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