Reba Dixon is a fifth grade school teacher who earneda salary of 38,000 in 2018. She is 45 years old and has beendivorced for four years. She receives 1,200 of alimony paymentseach month from her former husband. Reba also rent out a smallapartment building. This year Reba receive 50,000 of rentalpayments from tenant and she incurred 19,500 of expenses associatedwith the rental.
Reba and her daughterHeather (20 years old at the end of the year) moved to Georgia inJanuary of this year. Reba provides more than one half of Heathersupport. They had been living in Colorado for the past 15 years,but ever since her divorced, Reba has been wanting to go back toGeorgia to be closer to her family. Luckily last December, ateaching position opened up and Reba and Heather decided to make amove. Reba paid a moving company 2,010 to move their personalbelongings, and she and Heather spent two days driving the 1,426miles to Georgia.
Reba renteda home in Georgia. Heather decided to continue living at home withher mom, but she started attending school full time in January atnear by university. She was awarded a & 3000 partial tuitionscholarship this year and Reba help out by paying the remaining 500tuition cost. If possible, Reba thought it would be best to claimthe education credit for these expenses.
Rebawasn't sure if she would have enough items to help her benefit fromitemizing on her tax return, however she kept track of severalexpenses this year that she thought might qualify if she was ableto itemized. Reba paid 5800 in state income taxes and 12500 incharitable contribution during the year. She also paid thefollowing medical related expenses for herself and Heather :
Insurance premiums. 5,795
Medical care expenses 1,100
Prescriptionmedicine 350
Nonprescription medicine. 100
New contact lenses for Heather. 200
Shortly after the move, Reba gotdistracted while driving and she ran into a street sign. Theaccident caused 900 in damage to the car and gave her whiplash.Because the repair was less than her insurance deductible, she paidthe entire cost of the repair. Reba wasn't able to work for twomonths after the accident. Fortunately, she receives 2000 from herdisability insurance. Her employer, the central Georgia schooldistrict, paid 60%of premium on the policy as a non-taxable fringebenefits and Reba paid the remaining 40% portion.
A few years ago, Reba acquiredseveral investments with her portion of the divorce settlement.This year she reported the following income from her investments :2200 of interest income from corporate bonds and 1500 interestincome from city of Denver municipal bonds. Overall, Reba stockportfolio appreciated by 12000 but she did not sell any of herstock.
Heather reported 6200 of interestincome from corporate bonds she received as a gift from her fatherover the last several years. This was Heather only sources ofincome for the year. Reba had 10,000 of federal income taxeswithheld by employer. Heather made 1000 estimates tax paymentsduring the year. Reba did not make any estimate payments. Reba hadqualifying insurance for purposes of the affordable care Act(ACA).
Required :
(A) Determine Reba federal income taxes due or taxespayable for current year, complete pages 1 and 2 of forms 1040 forReba.
(b) is Reba allowed to file as a head of household orsingle?
(c) Determine the amount of FICA taxes Reba wasrequired to pay on her salary.
(d) Determine Heather federal income taxes due orpayable
