.Rodriguez Tax Return 3 50 Points Due November 6, 2020at 5 PM. Posted:October 25, 2020. Instructions: 1)The Tax return is due Friday November 6, 2020 at 5PM. 2)PREPARE the XXXXXXXXXXTAX RETURN for...

.Rodriguez Tax Return 3

50 Points

Due November 6, 2020at 5 PM.

Posted:October 25, 2020.

Instructions:

1)The Tax return is dueFriday November 6, 2020 at 5PM.

2)PREPARE the 2019 1040 TAX RETURN for Juan and Isabella Rodriguez.

3)Upon completion:UPLOAD YOUR FILE AS A PDF BUNDLE.How to combine and merge your files into one PDF:

1.Open Acrobat DCto combine files:Open theTools tab and select "Combine files."

2.Add files:Click "Add Files" and select the files you want to include in your PDF.You can merge PDFs or a mix of PDF documents and other files.

3.Arrange and delete content:Click, drag, and drop to reorder files or press "Delete" to remove any content you don't want.

4.Combine files: When you're finished arranging, click "Combine Files".

5.Save as a PDF file: Name your file and click the "Save" button. That's it.

4)Place forms in the following order:

a.First Page:Please sign your name and write:“I promise that I have not given or received assistance on this tax return (unless working with one other partner).I am an ethical person and my personal integrity cannot be compromised. I have abided by the San Francisco State University Code of Ethics.”

i.NOTE:You may work with only one other partner.You may not work with anyone else.Unfortunately, it was clear to me after I graded the second tax return, that there were some students who did not treat their signature, ethical vow, and personal integrity as sacred.Remember, nothing is more important in your profession as a Certified Public Accountant (and in the rest of your life) than your word, your honor, and your reputation.On behalf of those students who cheat, I apologize to the students who are in fact ethical.It is not fair to you.

b.Second Page:Attach
WORKSHEETS listed in items 7, 8, 9, and 10 below.

c.Third:Attach all Tax Return Formsin the following order:

i.1040 Page 1 and 2,

ii.Schedules 1 ,2, 3

iii.All Schedules with letters in sequence (e.g. Schedule A, B, C, D, E, SE )

iv.All numbered schedules in order:(For Example Schedules 4562, 4797, 8283, 8995)

5)You can find the forms on i-Learn under the section “Forms”.

6)After you have completed the netting process for the sale of each asset in item 10 below, you will have the 4 columns remaining below.Complete the following worksheet on the Excel Spreadsheet in a similar manner to the other tax returns you have completed:

7)You must calculate the appropriate amounts of depreciation for each asset and put them in the appropriate forms.Please complete the following chart for each asset:

8)For each asset that was sold please complete the following table.Remember on the sale of the car, the gain or loss is calculated separately for the personal portion and for the business portion.

9)Complete the following table for each asset and show the netting process.After you have complete the netting process below you can insert the results into your excel spreadsheet in item 7.

10)If you don’t know how to treat a particular issue, go to IRS.Gov and search Publications to find the appropriate topic, or Google the question (make sure you find a source that you can trust such as the IRS.)

11)Assume Juan used the ½ year convention for personal property in all prior years.

12)Unless otherwise stated, Juan wants to take the maximum depreciation possible.

13)Additional Rule:Special 25% Gain Netting Rules:Where there is a 1231 gain from real estate and that gain includes both potential 25% gain and potential 0/15/20%, any 1231 loss from disposition of other 1231 assets first offsets the 0/15/20% portion of the 1231 gain and then offsets the 25% gain portion of the 1231 gain.

14)Remember that on the sale of the car, you must split the gain or loss between the business portion and the personal portion.

Juan Rodriguez (born 04/01/1980, SS 565 11-1111) is a self-employed certified financial planner.His wife, Isabella Rodriguez (born 03/1/1983, SS 565-33-3333) is a part-time optician who works at Spectacles Eyewear, Oakland, Ca.They live at 1300 Rose Avenue, Oakland, Ca.94444.The Rodriguezes received the following W-2 and 1099 Forms.They have one daughter, Rosa Rodriguez (born 08/14/2010, 565-44-4444) who lives at home with them.

Juan is a certified financial analyst.He is in business for himself.Juan’s business is named JR Advisors.Juan had the following income and expenses in his business

Additional information related to his business:

Juan started his business on 1/1/2017.Before his business started, in early 2016, he hired a business consultant to help him strategize where to located his business, how to obtain clients, and other matters.He paid the consultant $25,000 on November 15, 2016.

Juan has one employee. Stella Cheung.He paid her a salary of $60,000.Juan withheld the following taxes from her paychecks:FICA taxes $4590, California taxes of $1500, federal taxes $2000.He also paid the employer’s share of FICA taxes.

Juan purchased a $6,000 insurance policy for fire and theft, malpractice, and renter’s insurance from Allstate Insurance Company.The amount was paid on 4/1/2019.It was a three year policy for the period 6/1/2019 to 5/31/2022.

Juan owned a small building at 3100 MacArthur Blvd, Oakland, Ca.94618 in which his office was located.He purchased it on 4/1/2017 for $700,000 (Land $100,000, Building $600,000) He paid the following expenses related to the building:

On December 1, 2017 he added a concrete handicap ramp to his business at a cost of $6000.

On 3/25/2019 Juan traded in his old IBM copy machine for a new Canon copy machine.Juan purchased the IBM on 8/1/2017 for $9000.In 2017, he wrote off the entire cost of $9000 cost under Section 179.The vendor of the Canon machine gave him a trade-in value of $3000 on the IBM.The Canon copier cost $12,000.Juan also paid installation costs of $500 and sales tax of $1200 on the Canon.Juan chooses Section 179 to deduct the Canon in 2019.

On 2/1/2017 Juan purchased a Dell computer for $5000 for his personal use at home.On 4/7/2018 he bought a replacement computer for his personal use, so he brought the Dell computer to his office to use in his business.At that time the computer had a FMV of $3000.He sold the computer for $800 on 10/8/2019.He used MACRS depreciation and the half-year convention for the computer.

On 2/5/2018 he purchased a used 2017 Toyota Camry for $20,000 plus $2000 sales tax.Juan had claimed the maximum depreciation deduction possible in 2018.He sold the Camry on 10/5/2019 for $23,300.He uses the actual method.He drove the following miles:

On 10/1/2019 Juan purchased a new Toyota 4Runner (over 6000 lbs) for $42,000.He paid $5000 cash and borrowed the remainder.His interest expense is on the 4Runner is listed below.He uses the actual expense method.He drove it the following miles:

Total amounts (business and non-business) spent for the car during the year:

The Rodriguez’s purchased a condo at 1380 Fillmore Street, Unit 1210, San Francisco, Ca.94132 for $1,000,000 (land $200,000, building $800,000) on 1/1/2018.They.The Rodriguezes are actively involved in managing the property but spend no more than 30 hours a year dealing with the property.

On 5/1/2019 the Rodriguezes purchased a new stove for $800 for the rental unit.

On 3/1/2017 Isabella’s grandmother Lilly died.Isabella inherited Lilly’s home at 3130 Kings Way, Sacramento, Ca.90046.Lilly purchased the house on 1/1/1960 for $80,000.On 3/1/2017 the house was worth $800,000 (Land $300,000, Building $500,000).In 2017 the Rodriguezes began renting it to tenants.They deducted depreciation in 2017 and 2018.In 2019 the Rodriguezes decided to sell the property. In 2019 received rental income of only $2000 before the tenants moved out on 1/15/2019.The only expenses for the house in 2019 were:property taxes $1000 and insurance $500.The Rodriguezes sold the property on 2/15/2019 for $1,000,000 (Land 400,000, Building 600,000). They paid a broker’s commission of $50,000.

In addition, the Rodriguezes had the following information (not included in amounts listed above):

Juan travelled to Las Vegas for a two-day course in financial planning.The course itself cost $900.Additionally, his total expenses for the two days were:$150 for airfare, $300 for lodging, $120 for meals for himself, $70 for car rental, $35 for dry-cleaning, $30 for tips, $80 for taking out a potential client to dinner and afterward $150 for seeing a Cirque Du Suleil show.(The expenses are not included in any of the expenses listed above).

On 1/3/2019 Isabella’s grandfather Morris gave Isabella 100 shares of Dell Corporation stock valued at $16,000.Morris had purchased the stock on 5/5/2018 for $17,000.Isabella sold the stock on 5/3/2019 for $15,125.

Other Expenses:

The Rodriguezes purchased their personal residence on 3/1/2012 for $1,200,000.They took out a $950,000 mortgage (acquisition debt).They paid interest expense of $48,000.They paid property taxes of $13,000.

On 9/3/2019, the Rodriguezes donated household furnishings to the Salvation Army.The furniture cost $8,000 on 3/10/ 2010 and had a FMV of $1000 in 2020.

Isabella was on the Board of the First Baptist Church.She went on a four day conference in Boston to represent her Church.She left Oakland on Monday 10/7/2019 and returned on Friday 10/11/2019.She incurred the following expenses on the trip.

The Rodriguezes paid the following amounts of estimated tax for 2019.

The Rodriguezes overpaid their 2018 Federal taxes by $450.Instead of choosing a refund, they chose to apply the overpayment to their first quarter estimated taxes.