Alan (66) and Cheryl (63) Hoover are married, file a joint return, and live at 666 Real Tired Avenue, Willimantic, Connecticut 06626. Alan is an attorney. His Social Security number is 886-56-8935.

Alan (66) and Cheryl (63) Hoover are married, file a joint return, and live at 666 Real Tired Avenue,

Willimantic, Connecticut 06626. Alan is an attorney. His Social Security number is 886-56-8935. Cheryl is a

second grade teacher. Her Social Security number is 200-40-8000. Alan’s office in the home is 600 square feet

and the total square footage of the house is 3,000 square feet. Alan and Cheryl purchased the house on January 6,

2005 for $280,000, of which $ 40,000 is attributable to the land.

They have a son, Ian (20), who lives with them, who they fully support, and who attended college full-time for

only the Spring 2012 semester (January-May). Ian earned $19,600 during the summer and fall. Cheryl’s mother

Thelma Gould (SS# 666-66-6666), who is age 71, lives with them for the entire tax year. Cheryl’s mother

receives $1,250 per month in social security benefits and has no other income or means of support except for her

son-in-law Alan (Alan provides more than half her support)

Additional information is as follows:

Items: Amount

• Alan – Gross earnings as self–employed attorney

(Employer Federal ID number (EIN) 05-0678888) $110,000

• Alan- Estimated taxes paid in during year

4/15/12: $2,100….. 6/15/12: $2,100….. 9/15/12: $2,100….1/15/13: $2,135 8,435

• Alan-Estimated state income tax paid during year 4,730

• Ordinary dividends from GE stock 15,950

• Interest on J.C. Penny Corp. domestic bonds 3,300

• Savings account interest—Pioneer Savings Bank 700

• Series EE bonds that matured in 2012 (used to pay for Ian’s tuition,

books and fees; ½ is interest) 6,100

• Interest on New York municipal bonds 3,450

• Cheryl – Salary as teacher 45,400

• Cheryl- Federal and FICA income tax withheld during year 8,473

• Home mortgage interest 15,600

• Sales tax paid 3,115

Alan’s Business Expenses

Use of auto: (Bought 2/15/12 $25,000) **Travel expenses: Office in the home:

Total miles 28,000 Hotel $3,700 Office supplies-direct $890

Business miles 22,000 Meals $ 820 Telephone – direct $1,100

Parking $280 Entertainment of clients $1,080 Utlities – indirect $ 3,400

Gas $9,000 Conference fee $1,000 Insurance -indirect $1,600

Insurance $1,200 Laundry $150 Repairs – indirect $1,800

Depreciation –car ? Transportation $ 500 Depreciation-home * ?

*Depreciation rate for part use of home office is 2.461% Equipment cost*** $6,500

per IRS rules (direct)

**There was no element of personal pleasure included in the

travel.

*** Equipment purchased 6/12/12

Cheryl’s Expenses

Professional dues $2,750

Professional journals $1,500

Uniform $1,650

Alan’s Expenses

Salary to secretary $15,000

FICA ?

SUTA/FUTA 725 ACC 416 Spring 2013 Silkoff

Alan and Cheryl also own a duplex (8 Duped St, Willimantic, Ct 06226 that they managed themselves. The

property was purchased on 6/2/2008. It produced the following rental income and expenses (80% rental):

Item Amount

(1) Gross rental income $9,200

(2) Mortgage interest 6,300

(3) Insurance 600

(4) Repairs and maintenance 1,050

(5) Real Estate taxes 1,200

(6) Utilities 1,850

(7) Homeowners’ association dues 2,475

(8) Depreciation ?

Contribution to a traditional IRA – Alan $7,000

Rental income (loss) on XYZ Limited Partnership – Cheryl 15,000

Ordinary business income (loss) on ABC Limited Partnership

– Alan (6,000)

Automobile registration fees (Alan $700; Cheryl $500) 1,200

Property taxes on personal residence 5,200

B Anthem Blue Cross health insurance premiums

(Cheryl is not covered by employer-provided medical insurance) 14,400

Other medical expenses 2,470

Tax preparation fees 1,750

Charitable Contributions :

Cash $9,000

GE stock-FMV 12,000

GE stock-Adjusted basis 7,000

Reported (to Willimantic Police Department) theft of Cheryl’s

jewelry from her home. Purchased ten years ago at a

cost of $10,300; appraised value was $9,700. Insurance

reimbursement was $2,000. ?

Ian completed first semester at Metropolitan State College.

Tuition, books and fees (SS# 223-22-1234) $4,630

Alan’s stock trades yielded:

Date purchased Date Sold Cost Sold

LT- 500 sh Chipotle 3/16/09 4/13/12 $8,600 $3,700

LT- 200 sh Mattel 8/22/11 8/23/12 2,300 5,500

ST- 100 sh United Airlines 3/18/11 2/5/12 2,000 1,000

ST- 400 sh Apple 10/12/12 12/30/12 12,500 20,300

Required:

Complete Alan and Cheryl Hoover’s federal tax return

(Form 1040 only) for 2012. Use Form 1040, Schedules

A,B,C,D, E, Forms 2106, 4562, 6251, 8828 and any other appropriate

schedule(s) and form(s) you may need. Make realistic

assumptions about any missing data. Do only the federal tax return.

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