Note: This problem is for the 2018 tax year. Alfred E. Old andBeulah A. Crane, each age 42, married on September 7, 2016. Alfredand Beulah will file a joint return for 2018. Alfred's SocialSecurity number is 111-11-1112. Beulah's Social Security number is123-45-6789, and she adopted "Old" as her married name. They liveat 211 Brickstone Drive, Atlanta, GA 30304. Alfred was divorcedfrom Sarah Old in March 2016. Under the divorce agreement, Alfredis to pay Sarah $1,250 per month for the next 10 years or untilSarah's death, whichever occurs first. Alfred pays Sarah $15,000 in2018. In addition, in January 2018, 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 for2018 is $150,000, and his employer, Cherry, Inc. (Federal I.D. No.98-7654321), provides him with group term life insurance equal totwice his annual salary. His employer withheld $24,900 for Federalincome taxes and $8,000 for state income taxes. The proper amountswere withheld for FICA taxes. Beulah recently graduated from lawschool and is employed by Legal Aid Society, Inc. (Federal I.D. No.11-1111111), as a public defender. She receives a salary of $42,000in 2018. Her employer withheld $7,500 for Federal income taxes and$2,400 for state income taxes. The proper amounts were withheld forFICA taxes. Beulah has $500 in qualified dividends on YellowCorporation stock she inherited. Alfred and Beulah receive a $1,900refund on their 2017 state income taxes. They itemized deductionson their 2017 Federal income tax return (total of $15,000). Alfredand Beulah pay $4,500 interest and $1,450 property taxes on theirpersonal residence in 2018. Their charitable contributions total$2,400 (all to their church). They paid sales taxes of $1,400, forwhich they maintain the receipts. Both spouses had health insurancefor all months of 2018 and do not want to contribute to thePresidential Election Campaign. Required: Compute Alfred andBeulah's net tax payable (or refund due) for 2018, on a jointreturn, by providing the following information that would bereported on Form 1040, Schedule A, and Schedule B. Enter allamounts as positive numbers. If is zero, enter "0". Make realisticassumptions about any missing data. If required round your finalanswers to the nearest dollar.
