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Janice Morgan, age 32, is single and has no dependents. She is a freelance writer. In January 2011, Janice opened her own office located at 2751 Waldham road, Pleasat Hill, NM 88135. She called her buiness Writers Anonymous. Janice is a cash basis taxpayer. She lives at 132 Stone Avenue, Pleasant Hill, NM 88135. Her Social Security number is 123-45-6789. Janice wants to contribute to the Presidentual Election campaign fund. During 2011, Janice had the following income and expense items connected with her business:
Income from sales of articles $105,000
Rent $16,500
Utilities $7,900
Supplies $1,800
Insurance $5,000
Travel (including meals of $1,200) $3,500
Janice purchased and placed in service the following fixed assets for her business:
• Furniture and fixtures (new) costing $17,000 on January 10, 2011.
• Computer equipment (new) costing $40,000 on July 28, 2011.
Janice did not elect immediate expensing under 179. She elected not to take addional first year depreciation.
Janice’s itemized deductions are as follows:
State income tax $3,000
Home mortgage interest paid to First Bank $6,000
Property taxes on home $1,500
Charitable contributions $1,200
Janice did not keep a record of the sales tax she paid. The amount from the sales tax table is $437.
Janice has interest income of $5,000 on certificates of deposit at Second Bank. Janice makes estimated tax payments of $17,000 for 2011.
Compute Janice Morgan’s 2011 Federal income tax payable (or refund due.) If you use tax forms for your conputations, you will need forms 1040 and 4562 and schedules A,B,C, and SE.
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