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Question: basic scenario 8 emily clark using the tax software complete...

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Basic Scenario 8: Emily Clark

Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario. Note: When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.

Interview Notes

• Emily is single and has two young girls, Sara and Madison, who lived with her all year.

• Emily paid more than half of the support for her daughters and all the cost of keeping up the home.

• Emily was unemployed for two months (March and April). She cashed in her 401(k) savings and used the money to pay household expenses.

• Emily is paying off a student loan that she took out when she attended college for a few courses in 2015.

• She took some courses this year at Drew Community College to improve her job skills as a health aide.

• Emily and her two daughters, Sara and Madison, had qualified health insurance from her employers for 10 months out of the year. They did not have coverage in March and April.

SECURIT》 SOCIAL 259-00-XXXX Emily Clark Eauila Cla SECO 541-00-XXXX Sara Clark Sara SOCIALS NL SEC 542-00-XXXX Madison Clark SIGNATURE

Form-13614-C Department of the Treasury -Internal Revenue Service Intake/Interview & Quality Review Sheet OMB Number 1545-1964 (October 2018) Please complete pages 1-3 of this form You are responsible for the information on your return. Please provide complete and accurate information If you have questions, please ask the IRS-certified volunteer preparen You will need: Tax Information such as Forms W-2, 1099, 1098, 1095 Social security cards or ITIN letters for all persons on your tax return Picture ID (such as valid drivers license) for you and your spouse Volunteers are trained to provide high quality service and uphold the highest ethical standards To report unethical behavior to the IRS, email us at  Part I - Your Personal Information (If you are filing a joint return, enter your names in the same order as last years return) 1. Your first name EMILY 2. Your spouses first name M.I. Last name Daytime telephone number Are you a U.S. citizen? YOUR PHONE # CLARK M.I. Last name Daytime telephone number Is your spouse a U.S. citizen? 3. Mailing address 129 PENNINGTON PLACE 4. Your Date of Birth 04/29/1978 7. Your spouses Date of Birth 8. Your spouses job title State YOUR CITY YOUR ZIP a. Full-time student Yes No 6. Last year, were you: b. Totally and permanently disabled Yes No c. Legally blind 9. Last year, was your spouse: b. Totally and permanently disabled Yes No c. Legally blind 5. Your job title MED ASSISTANT a. Full-time student □ Yes □ No 10. Can anyone claim you or your spouse as a dependent? Yes 凶No Unsure 11. Have you, your spouse, or dependents been a victim of tax related identity theft or been issued an Identity Protection PIN? Part II-Marital Status and Household Information 1. As of December 31, 2018, what X Never Married (This includes registered domestic partnerships, civil unions, or other formal relationships under state law) was your marital status? Married a. If Yes, Did you get married in 2018? b. Did you live with your spouse during any part of the last six months of 2018 YesNo Date of final decree Date of separate maintenance agreement Year of spouses death vorced □ Legally Separated □ Widowed 2. List the names below of everyone who lived with you last year (other than your spouse) anyone you supported but did not live with you last year If additional space is needed check hereand list on page 3 To be completed by a Certified Volunteer Preparer Name (first, last) Do not enter your Date of Birth Relationship Number of US name or spouses name below Resident Single or Full-time Totally and Is this Did this Did this Did the mm/ddlyy) toyou (for months Citizen of US, Married as Student Permanently person a personperson taxpayer(s) taxpayer(s) example: lived in (yes/no) Canada, of 12/31/18 last year Disabled qualifying provide have less provide more pay more than son daughter, last year parent, none, eto) your home or Mexico (S/M) last year (yes/no) (yesno) | (yes/no) child/relative | more than of any other 50% of his/ | of income? | support for person? her own (yes/no) this person? (yes/no)support? | than $4,150 | than 50% of | half the cost of l maintaining a home for this yes/no/N/A) person? (yes/no) SARA CLARK MADISON CLARK 05/06/10 DAUGHTER12 07131/12 DAUGHTER12 YES YES YES YES YES YES Catalog Number 52121E www.irs.gov Form 13614-C (Rev. 10-2018)

Page 2 Check appropriate box for each question in each section Yes No Unsure Part Ill -Income Last Year, Did You (or Your Spouse) Receive 図| □ | □ | 1, (B) Wages or Salary? (Form W-2) If yes, how many jobs did you have last year? 2 X2. (A) Tip Income? X3. (B) Scholarships? (Forms W-2, 1098-T) □ | K □ | 4. (B) Interest/Dividends from: checking/savings accounts, bonds, CDs, brokerage? (Forms 1099-INT, 1099-DIV) □ | K | □ | 5, (B) Refund of state/local income taxes? (Form 10993) X 6. (B) Alimony income or separate maintenance payments? X 7. (A) Self-Employment income? (Form 1099-MISC, cash) □ | K □ | 8, (A) Cash/check payments for any work performed not reported on Forms W-2 or 1099? □ |凶| □ | 9. (A) Income (or loss) from the sale of Stocks, Bonds or Real Estate? (including your home) (Forms 1099-S,1099-B) □ K □ | 10. (B) Disability income? (such as payments from insurance, or workers compensation) (Forms 1099-R, W-2) 凶| [ □ | 11. (A) Retirement income or payments from Pensions, Annuities, and or IRA? (Form 1099-R 凶| □ | □ | 12, (B) Unemployment Compensation? (Form 10996) X13. (B) Social Security or Railroad Retirement Benefits? (Forms SSA-1099, RRB-1099) 凶| □ | 14. (M) Income (or loss) from Rental Property? □ |凶| | 15. (B) Other income? (gambling, lottery, prizes, awards, jury duty, Sch K-1, royalties, foreign income, etc.) Specify Yes No Unsure Part IV- Expenses Last Year, Did You (or Your Spouse) Pay □ | K | □ | 1. (B) Alimony or separate maintenance payments? If yes, do you have the recipients SSN? □ Yes □ No □ | K) | □ | 2 . Contributions to a retirement account? 凶| □ | □ | 3, (B) College or post secondary educational expenses for yourself, spouse or dependents? (Form 1098-T) I X4. (A) Deductions: Medical & Dental (including insurance premiums) IRA (A) 401K (B) □ Roth IRA (B) Other □ Mortgage Interest (Form 1098) □ Taxes (State, Real Estate, Personal Property, Sales) Charitable Contributions XO5. (B) Child or dependent care expenses such as daycare? □ | K □ | 6. (B) For supplies used as an eligible educator such as a teacher, teachers aide, counselor, etc.? □ | K | □ | 7. (A) Expenses related to self-employment income or any other income you received? 凶| □ | □ | 8, (B) Student loan interest? (Form 1098-E) Yes No Unsure Part V Life Events Last Year, Did You (or Your Spouse) □ □ | 1. (HSA) Have a Health Savings Account? (Forms 5498-SA, 1099-SA, W-2 with code W in box 12) □ |冈| □ | 2, (A) Have credit card or mortgage debt cancelled/forgiven by a lender or have a home foreclosure? (Forms 1099-C 1099-A) X 3. (A) Adopt a child? □ { | □ | 4. (B) Have Earned income Credit, Child Tax Credit or American Opportunity Credit disallowed in a prior year? □ | | □ | 5. (A) Purchase and install energy-efficient home items? (such as windows, furnace, insulation, etc.) □-> | □ | 6. (B) Live in an area that was declared a Federal disaster area? If yes, where? X7. (A) Receive the First Time Homebuyers Credit in 2008? □ X | □ | 8, (B) Make estimated tax payments or apply last years refund to this years tax? If so how much? □ | X] | □ | 9. (A) File a federal return last year containing a capital loss carryover on Form 1040 Schedule D? □ | | □ | 10. Receive a letter from the IRS? If yes, for which tax year? Catalog Number 52121E www.irs.gov Form 13614-C (Rev. 10-2018)

Page 3 Check appropriate box for each question in each section Yes No Unsure Part VI Health Care Coverage Last year, did you, your spouse, or dependent(s) X | □ | □ | 1, (B) Have health care coverage? [ D& | □ | 2, (B) Receive one or more of these forms? (Check the box) □ Form 1095-B □ Form 1095-C X3. (A) Have coverage through the Marketplace (Exchange) [Provide Form 1095-A] 3a. (A) If yes, were advance credit payments made to help you pay your health care premiums? 3b. (A) If yes, Is everyone listed on your Form 1095-A being claimed on this tax return? 1 4. (B) Have an exemption granted by the Marketplace? To be Completed by a Certified Volunteer Preparer (Use Publication 4012 and check the appropriate box(es) indicating Minimum Essential Coverage (MEC) for everyone listed on the return.) Name MEC AlI YearNo MEC Months with MEC Months with Exemption Exempt All Year Notes Taxpayer Spouse Dependent Dependent Dependent Part VIl - Additional Information and Questions Related to the Preparation of Your Return 1. Provide an email address (optional) (this email address will not be used for contacts from the Internal Revenue Service) 2. Presidential Election Campaign Fund (If you check a box, your tax or refund will not change) JFMAMJJASONDİJ F M A M J J A S O N D JFMAMJJASONDİJ F M A M J J A S O N D JFMAMJJASONDİJ F M A M J J A S O N D JFMAMJJASONDİJ F M A M J J A S O N D JFMAMJJASONDİJ F M A M J J A S O N D You Spouse Check here if you, or your spouse if filing jointly, want $3 to go to this fund 3. If you are due a refund, would you like a. Direct deposit b. To purchase U.S. Savings Bonds c. To split your refund between different accounts X Yes Yes □ Yes 4. If you have a balance due, would you like to make a payment directly from your bank account? Yes Many free tax preparation sites operate by receiving grant money. The data from the following questions may be used by this site to apply for these grants Your answers will be used only for statistical purposes 5. Would you say you can carry on a conversation in English, both understanding & speaking? > Very well □ Well □ Not well □ Not at all □ Prefer not to answer 6. Would you say you can read a newspaper or book in English? 7. Do you or any member of your household have a disability? 8. Are you or your spouse a Veteran from the U.S. Armed Forces? Additional comments X No very well [ Well Yes Yes Not well Prefer not to answer Prefer not to answer Not at all Prefer not to answer x No Privacy Act and Paperwork Reduction Act Notice The Privacy Act of 1974 requires that when we ask for information we tell you our legal right to ask for the information, why we are asking for it, and how it will be used. We must also tell you what could happen if we do not receive it, and whether your response is voluntary, required to obtain a benefit, or mandatory. Our legal right to ask for information is 5 U.S.C. 301. We are asking for this information to assist us in contacting you relative to your interest and/or participation in the IRS volunteer income tax preparation and outreach programs. The information you provide may be furnished to others who coordinate activities and staffing at volunteer return preparation sites or outreach activities. The information may also be used to establish effective controls, send correspondence and recognize volunteers. Your response is voluntary. However, if you do not provide the requested information, the IRS may not be able to use your assistance in these programs. The Paperwork Reduction Act requires that the IRS display an OMB control number on all public information requests. The OMB Control Number for this study is 1545-1964. Also, if you have any comments regarding the time estimates associated with this study or suggestion on making this process simpler please write to the Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP T T:SP, 1111 Constitution Ave. NW, Washington, DC 20224 Catalog Number 52121E www.irs.gov Form 13614-C (Rev. 10-2018)

a Employees social security number ate, Visit the IRS website at www.irs.govefile accura 259-00-XXXX OMB No. 1545-0008 FASTI Use b Employer identification number (EIN) 1 Wages, tips, other compensation 3 Social security wages 5 Medicare wages and tips 7 Social security tips 33,000.00 33,000.00 33,000.00 2 Federal income tax withheld 2,600.00 4 Social security tax withheld 2,046.00 35-600XXXX c Employers name, address, and ZIP code SALEM RETIREMENT HOME 1270 WEST 29TH STREET YOUR CITY, STATE ZIP 6 Medicare tax withheld 479.60 8 Allocated tips d Control number 9 Verification code 10 Dependent care benefits e Employees first name and initial Last name Suff. 11 Nonqualified plans 12a See instructions for box 12 3,800.00 Statutony EMILY CLARK 129 PENNINGTON PLACE YOUR CITY, STATE ZIP sick pay er 12C 12d fEmployees address and ZIP code 15 State Employers state ID number 16 State wages, tips, etc. 17 State income tax 18 Local wages, tips, etc. 19 Local income tax 20 Locality name YS 35-600XXXX 33,000.00 2,238.00 Wage and Tax Statement 2018 Department of the Treasury-Internal Revenue Service Form Copy B-To Be Filed With Employees FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service a Employees social security number Safe, accurate, Visit the IRS website at www.irs.govlefile 259-00-XXXX OMB No. 1545-0008 FASTI Use b Employer identification number (EIN) 2 Federal income tax withheld 1 Wages, tips, other compensation 3 Social security wages 5 Medicare wages and tips 7 Social security tips 3,500.00 3,500.00 3,500.00 39-700XXXX c Employers name, address, and ZIP code 350.00 4 Social security tax withheld 217.00 DAVIDSON INC. 4325 NORTHRIDGE AVE YOUR CITY, STATE ZIP 50.75 8 Allocated tips 9 Verification code 10 Dependent care benefits e Employees first name and initial Last name Suff. 11 Nonqualified plans 12a See instructions for box 12 450.00 dparty 12b sick pay EMILY CLARK 129 PENNINGTON PLACE YOUR CITY, STATE ZIP 4 Other 12c 12d f Employees address and ZIP code 15 State Employers state ID number 16 State wages, tips, etc. 17 State income tax 18 Local wages, tips, etc. 19 Local income tax20 Locality name YS 39-700XXXX 3,500.00 210.00 Wage and Tax 201D Department of the Treasury-Internal Revenue Service - Statement Form Copy B-To Be Filed With Employees FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service

CORRECTED (if checked PAYERS name, street address, city or town, state or province, country, ZIP1 Unemployment compensation OMB No. 1545-0120 or foreign postal code, and telephone no. STATE UNEMPLOYMENT COMMISSION 1000 GOVERNMENT PLAZA YOUR CITY, STATE ZIP (555) 555-4321 PAYERS TIN ertain Government $2,200.00 2018 2 State or local income tax refunds, credits, or offsets Payments Form 1099-G 4 Federal income tax withheld $220.00 ору В For Recipient RECIPIENTS TIN 3 Box 2 amount is for tax year 35-700XXXX 259-00-XXXX RECIPIENTS name 5 RTAA payments This is important tax information and is being furnished to the IRS. If you are required EMILY CLARK 7 Agriculture payments 8 If checked, box 2 is trade or business Street address (including apt. no.) 129 PENNINGTON PLACE City or town, state or province, country, and ZIP or foreign postal code YOUR CITY, STATE ZIP Account number (see instructions) 9 Market gain $ 10a State 10b State identification no negligence penalty or other sanction may be on you if this income is taxable and the IRS determines that it has not been reported. im 11 State income tax withheld Fom 1099-G (keep for your records) www.irs.gov/Form 1099G Department of the Treasury-Internal Revenue Service CORRECTED (if checked Distributions From Retirement Plans Insurance Contracts, etc OMB No. 1545-0119 PAYERS name, street address, city or town, state or province, country, and ZIP or foreign postal code 1 Gross distribution 2018 2,000.00 KENT STATE BANK FOR SALEM RETIREMENT HOME 401(K) 743 COLQUITT WAY YOUR CITY, STATE ZIP 2a Taxable amount 2.000.00 Taxable amount not determined Form 1099-R 2b distribution X Report this income on your PAYERS TIN RECIPIENTS TIN 3 Capital gain (included 4 Federal income tax withheld return. If this form shows federal income tax withheld in box 4, attach 38-200XXXX RECIPIENTS name 300.00 5 Employee contributions/ 6 Net unrealized 259-00-XXXX appreciation in employers securities uary. contributions or insurance premiums this copy ft EMILY CLARK your return. Street address (including apt. no.) 7 Distribution code(s) RA 8 Other SEP This information is being furnished to SIMPLE 129 PENNINGTON PLACE 1 City or town, state or province, country, and ZIP or foreign postal code 9a Your percentage of total 9b Total employee contributions YOUR CITY, STATE ZIP 10 Amount allocable to IRR distribution 11 1st year FATCA filing 12 State tax withheld13 State/Payers state no. 14 State distribution desig. Roth contrib. requirement within 5 years Account number (see instructions) 15 Local tax withheld 16 Name of locality 17 Local distribution Fom 1099-R www.irs.gov/Form1099R Department of the Treasury-Internal Revenue Service

CORRECTED (if checked OMB No. 1545-1576 RECIPIENTS/LENDERS name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone number FINANCIAL AID PARTNERS 666 LINCOLN YOUR CITY, STATE ZIP 2018 Student Loan Interest Statement Form 1098-E RECIPIENTS TIN BORROWERS TIN 1 Student loan interest received by lender 38-900XXXX BORROWERS name 259-00-XXXX 600.00 For Borrower This is important tax information and is being fumished to the IRS. If you are required to file a retum, a negligence EMILY CLARK Street address (including apt. no.) or 129 PENNINGTON PLACE City or town, state or province, country, and ZIP or foreign postal code sanction may be on you if the IRS determines that an of tax you overstated a deduction for student loan interest. er YOUR CITY, STATE ZIP Account number (see instructions) results 2 If checked, box 1 does not include loan origination fees and/or capitalized interest for loans made before ember 1, 2004 Fom 1098-E (keep for your records) www.irs.gov/Form1098E Department of the Treasury Internal Revenue Service CORRECTED FILERS name, street address, city or town, state or province, country, ZIP or 1 Payments received for foreign postal code, and telephone number OMB No. 1545-1574 qualified tuition and related DREW COLLEGE 1000 COLLEGE AVE YOUR CITY, STATE ZIP $ 2.800,.00 2018 Tuition Statement Form 1098-T FILERS employer identification no. STUDENTS TIN 3 If this box is checked, your educational institution changed its reporting method for 2018 35-500XXXX STUDENTS name 259-00-XXXX For Student 4 Adjustments made for 5 Scholarships or grants This is important tax information and is being furnished to the IRS. This form must be used to complete Form 8863 to claim education credits. Give it to the tax preparer or use it to prepare the tax return. prior year EMILY CLARK Street address (including apt. no.) 6 7 Checked if the amount scholarships or grants for a prior year in box 1 includes amounts for an academic period 129 PENNINGTON PLACE City or town, state or province, country, and ZIP or foreign postal code anu YOUR CITY, STATE ZIP March 2019 Service Provider/Acct. No. (see instr.) 8 Check if at least 9 Checked if a graduate 10 Ins. contract reimb/refund half-time studentstudent Form 1098-T (keep for your records) Department of the Treasury-Internal Revenue Service www.irs.gov/Form1098T

303 Twiggs Trail Your City, Your State Your Zip (555) 555-1234 Rivers Child Care December 31, 201 Received from Emily Clark $1,500 for after-school care for Sara Clark $1,500 for after-school care for Madison Clark $3,000 Total amount received for child care in 2018 Ellen River EIN: 35-900XXXX 1234 Emily Clark 129 Pennington Place Your City, State 00000 20 PAY TO THE ORDER OF DOLLARS Adelphi Bank and Trust Anytown, State 00000 For : 111000025 123456789 1234

Questions:

20. Emily can claim an exemption on her 2018 tax return for not having healthcare coverage for 2 months of the year.
True
False
21. Emily qualifies for the American opportunity credit.
True
False
22. What is the total federal income tax withheld shown on Emily's tax return?
A. $2,600
B. $2,950
C. $3,170
D. $3,470

23. What is Emily's total credit amount shown on Form 2441, Child and Dependent Care Expenses? $________.

24. Emily does NOT qualify for the child tax credit.
True
False
25. Emily must pay a 10% additional tax of $________ on her early distribution from her 401(k).


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