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Noah and Joan Arc live in Dayton, OH. They have 2 sons Mike, age 18 and Sam age 14. Both sons live with parents. Mike is in first year of college.

Noah operates and fully manages a pet store in his town. This business is a single proprietorship. The following is the financial information for this business.

Revenue $185000

Cost of goods sold $61000

Insurance 1080

Professional fees 1700

Rent exp 8800

Utilities 2200

Wages 25000 TO OTHER EMPLOYEES.

Automobile exp 2400

Depreciation 3800

Joan works as a nurse in the city fire rescue center. Her salary information:

Salary 77800

Federal tax withheld and paid 4025

State tax withheld and paid 1240

They also own a vacation home on Lake Erie which was rented for 220 days and used for personal use for 20 days. This house is regularly used a secondary residence. They significantly participated in management of this rental activity. Revenue and expenses for entire year:

Rental revenue 19000

Insurance 1800

Mortgage interest 6870

Property tax 3000

Repairs 4000

Utilities 2000

Depreciation 9000

Use the Tax Court Method for Allocating the Expenses to the Rental Days

During the year they sold some of their investment in stock. The information is as follows:

Stock Purchase date cost sale date sale price

BNB 2/10/2011 3500 8/5/2021 1500

MNM 01/03/2020 5300 8/5/2021 6100

XZX 10/2/2008 10300 8/5/2021 15300

There is a long term loss carryover from previous year in the amount of $2400. None of these stocks belong to qualified small business or section 1244.

During the year, on 5/1/2021, they sold a jewelry for $9,000. This property was given to Joan as a gift from her grandmother. The date of the gift was 7/4/2019. The grandmother purchased this jewelry in 2000 for $10,000. The fair value on the date of the gift was $8,000.

During the year the following amounts were paid

College tuition 22000

books and supplies 4500

Mortgage interest on MAIN residence 11300

Property tax 3600

Political contribution to state senator 250

Church donation 2600 cash

Medical expenses 2200

Donations to red cross 1000

They redeemed EE bonds and received $10,000: $2,000 of this amount is interest.

They also paid the following estimated taxes

Estimated federal tax 3000

Estimated state tax 1020

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Calculate the following for 2021

Wages and Salaries

Profit/Loss From Pet Store

Profit/Loss from Rental Home

Net Capital Gain/Loss for 2021

ADJUSTED GROSS INCOME: after adjusting for pet business, vacation home rental, net capital gain or loss, self employment tax, EE bonds interest, charity deduction. Show all supporting calculations.

Standard/Itemized Deduction

Taxable Income and Income Tax 2021

Tax Credit Amount

Tax Due/Refund

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