First Assignment: 2 Discussions

Topic 1:
Based on readings in your textbook and an article from the KU library, explain the relationship between standard deduction and itemized deduction.  What changes did the Tax Cuts and Jobs Act (TCJA) make to the standard deduction?  How do you think this change will affect Charitable Giving in future tax years?

Do not forget to make your posts to the other topic this week.

Topic 2:
You are a CPA paid to prepare tax returns for various clients.  One of your clients is determined to deduct the cost of adding a swimming pool to his house as an itemized deduction for medical expenses.  He argues this is a qualified medical expense, as he plans on swimming laps in the pool for exercise.  You do not agree that this expenditure is a deductible medical expense, but your client is insisting it is.  You know the cost will not exceed 7.5% of the taxpayer’s AGI, and therefore will not be deductible anyway.  To appease your client, you list the expense as an itemized deduction since it will not impact the final tax calculation.  Do you think you made the correct decision?   Where would you look for guidance on how to handle this scenario?  

Reference and apa format

Second assignment:

You are working for a local accountant during tax season and the accountant has asked you to help with the tax preparation needs of Russell and Denise Powell. 

 

Russell and Denise Powell are married filing jointly.  Their address is 525 Spencer Street Miami, FL  33054. 

 Russell Powell                                                                  Denise Powell 

 Social Security Number:  412-34-5670                              Social Security Number:  412-34-5671 

 Date of Birth:  4/11/1971                                                     Date of Birth:  7/24/1974 

 W-2 For Russell shows these amounts:                             W-2 for Denise shows these amounts: 

 Wages (Box 1):  $75,000                                                    Wages (Box 1):  $35,000  

 Federal W/H (Box 2): $6,950                                              Federal W/H (Box 2): $3,820 

 Social Security Wages (Box 3): $75,000                            Social Security Wages (Box 3): $35,000 

 Social Security W/H (Box 4): $4,650                                  Social Security W/H (Box 4): $2,025 

 Medicare Wages (Box 5): $75,000                                     Medicare Wages (Box 5): $35,000 

 Medicare W/H (Box 6): $1,088                                           Medicare W/H (Box 6): $475 

 

  • Form 1099-INT for Russell and Denise show this amount: Box 1 = $3,740 Peninsula Bank
  • They also received tax-exempt interest of $1,500, as well as $90 for jury duty pay when Denise went to court to serve for two days.
  • Denise received two weeks of worker’s compensation pay for a total of $1,750.
  • Dependent:  Daughter Sarah Powell.  Her date of birth is 6/15/2008.  Her Social Security number is 412-34-5672

 Fill out the appropriate tax form for Russell and Denise Powell.  Tax forms can be obtained from the IRS website.  **Be sure you save the form to your computer BEFORE you fill in any information or your data will be lost when you save the file with the data entered. Once saved, access the saved form from your computer, not the web browser.