Note: This problem is for the 2019 tax year.Alfred E. Old and Beulah A. Crane, each age 42, married...

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Note: This problem is for the 2019 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2017. Alfred and Beulah will file a joint return for 2019. Alfred's Social...

Note: This problem is for the 2019 tax year.

Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2017. Alfred and Beulah will file a joint return for 2019. Alfred's Social Security number is 111-11-1109. Beulah's Social Security number is 123-45-6780, and she adopted "Old" as her married name. They live at 211 Brickstone Drive, Atlanta, GA 30304.

Alfred was divorced from Sarah Old in March 2016. Under the divorce agreement, Alfred is to pay Sarah $1,250 per month for the next 10 years or until Sarah's death, whichever occurs first. Alfred pays Sarah $15,000 in 2019. In addition, in January 2019, Alfred pays Sarah $50,000, which is designated as being for her share of the marital property. Also, Alfred is responsible for all prior years' income taxes. Sarah's Social Security number is 123-45-6788.

Alfred's salary for 2019 is $150,000. He is an executive working for Cherry, Inc. (Federal I.D. No. 98-7654321). As part of his compensation package, Cherry provides him with group term life insurance equal to twice his annual salary. His employer withheld $24,900 for Federal income taxes and $8,000 for state income taxes. The proper amounts were withheld for FICA taxes.

Beulah recently graduated from law school and is employed by Legal Aid Society, Inc. (Federal I.D. No. 11-1111111), as a public defender. She receives a salary of $42,000 in 2019. Her employer withheld $7,500 for Federal income taxes and $2,400 for state income taxes. The proper amounts were withheld for FICA taxes.

Alfred and Beulah had interest income of $500. Alfred and Beulah receive a $1,900 refund on their 2018 state income taxes. They claimed the standard deduction on their 2018 Federal income tax return. Alfred and Beulah pay $4,500 interest and $1,450 property taxes on their personal residence in 2019. Their charitable contributions total $2,400 (all to their church). They paid sales taxes of $1,400, for which they maintain the receipts. Both spouses had health insurance for all of 2019 and they do not want to contribute to the Presidential Election Campaign.

Required:

Compute the Olds' net tax payable (or refund due) for 2019. Use Form 1040 and Schedule 1 to complete this tax return.

It may be necessary to complete the tax schedule and worksheet before completing Form 1040.

Enter all amounts as positive numbers.

If an amount box does not require an entry or the answer is zero, enter "0".

Make realistic assumptions about any missing data.

When computing the tax liability, do not round your immediate calculations. If required round your final answers to the nearest dollar.

Use the

2019 Tax Rate Schedule

provided. Do not use the Tax Tables.

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Answered Same DayOct 19, 2021

Riddhi · Accepted Answer

Note: The form, instructions, or publication you are looking 
for begins after this coversheet.
Please review the updated information below.
Reporting Excess Deductions on Termination of an Estate or Trust on 
Forms 1040, 1040-SR, and 1040-NR for Tax Year 2018 and Tax Year 
2019
Under Proposed Regulations 113295-18, an excess deduction on termination of an estate or 
trust allowed in arriving at adjusted gross income (Internal Revenue Code (IRC) section 67(e) 
expenses) is reported as an adjustment to income on Forms 1040, 1040-SR, and 1040-NR; 
non-miscellaneous itemized deductions are reported, as applicable, on Schedule A (Form 1040 
or 1040-SR) or Schedule A (Form 1040-NR); and miscellaneous itemized deductions are not 
deductible. Taxpayers may rely on the proposed regulations for tax years of beneficiaries 
beginning after 2017 and before the final regulations are published.
For tax year 2019, an excess deduction for IRC section 67(e) expenses is reported as a 
write-in on Schedule 1 (Form 1040 or 1040-SR), Part II, line 22, or Form 1040-NR, line 34. 
On the dotted line next to line 22 or line 34 (depending on which form is filed), enter the 
amount of the adjustment and identify it using the code “ED67(e)”. Include the amount of 
the adjustment in the total amount reported on line 22 or line 34.
For tax year 2018, an excess deduction for IRC section 67(e) expenses is reported as a 
write-in on Schedule 1 (Form 1040), line 36, or Form 1040-NR, line 34. On the dotted line 
next to line 36 or line 34, (depending on which form is filed), enter the amount of the 
adjustment and identify it using the code “ED67(e)”. Include the amount of the adjustment in 
the total amount reported on line 36 or line 34.
Fo
rm1040 Department of the Treasury—Internal Revenue Service (99)U.S. Individual Income Tax Return 2019 OMB No. 1545-0074 IRS Use Only—Do not write or staple in this space. 
Filing Status  
Check only 
one box.
Single Married filing jointly Married filing separately (MFS) Head of household (HOH) Qualifying widow(er) (QW)
If you checked the MFS box, enter the name of spouse. If you checked the HOH or QW box, enter the child’s name if the qualifying person is 
a child but not your dependent.  ▶
Your first name and middle initial Last name Your social security number 
If joint return, spouse’s first name and middle initial Last name Spouse’s social security number 
Home address (number and street). If you have a P.O. box, see instructions. Apt. no. 
City, town or post office, state, and ZIP code. If you have a foreign address,

Note: This problem is for the 2019 tax year. Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2017. Alfred and Beulah will file a joint return for 2019. Alfred's Social...

Answer To: Note: This problem is for the 2019 tax year. Alfred E. Old and Beulah A. Crane, each age 42,...

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