Spencer Duck (SSSN 000-22-111) is single and his eight year old son, Mitch, lives with him...

60.1K

Verified Solution

Question

Accounting

Spencer Duck (SSSN 000-22-111) is single and his eight year oldson, Mitch, lives with him nine months of the year in a rentedcondominium at 321 Hickory Drive in Ames, Iowa. Mitch lives withhis mom, Spencer's Ex-wife, during the summer months. His motherprovides more than half of Mitch's support and Spencer has agreedto allow her to claim Mitch as her dependent. Spencer has a salaryof $39,000 and itemized deductions of $4,000. Taxes withheld duringthe year amount to $3,221. On July 14 of the current year, he soldthe following assets: -Spencer received a K-1 from a partnershipindicating that his share of the partnership STCL is $200 -Land wassold for $35,000. The land was received as a property settlement onJanuary 10,2001, when the land's FMV amounted to $30,000. Hisex-wife's basis for the land, purchased on January 10, 1991, was$18,600. -A personal-use computer acquired on March 2 last year for$4,000 was sold for $2,480. -A membership card for a prestigiouscountry club was sold for $8,500. The care was acquired on October10,1993, for $6,000. -Marketable securities held as an investmentwere sold for $20,000. The securities were inheritied from hisuncle, who died on March 10 of the current year when FMV of thesecurities was $21,000. The uncle purchased the securities on May10, 1990, for $10,700. In addition to the above sales, Spencerreceived a $100 refund of state income taxes paid last year.Spencer used the standard deduction last year to computer his taxliability. Prepare Form 1040 and Schedule D for the currentyear.

Answer & Explanation Solved by verified expert

4.5 Ratings (895 Votes)

Use Schedule D Form 1040 to report the following The sale or exchange of a capital asset not reported on another form or schedule Gains from involuntary conversions other than from casualty or theft of capital assets not held for business or profit If your only capital gains income is cap gains distribution from a mutual fund reported on a 1099DIV then scheduled D is notrequierd and it is not prepared The capital gain is reported directly on Form 1040 and the Schedule D not required Internal Revenue Service IRS Form 8949 and Schedule D are the Capital Gains and Losses section of the Form 1040 Schedule D is used to calculate and report the sale or exchange of a capital asset To start you will need to fill out Form 8949 This form allows you to total your gains and losses for various investments and assets obtained during the year On your Schedule D form you will use these values to figure out if you had a net lossgain for the year in terms of short and long term investments Then we can examine how See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

Spencer Duck (SSSN 000-22-111) is single and his eight year oldson, Mitch, lives with him nine months of the year in a rentedcondominium at 321 Hickory Drive in Ames, Iowa. Mitch lives withhis mom, Spencer's Ex-wife, during the summer months. His motherprovides more than half of Mitch's support and Spencer has agreedto allow her to claim Mitch as her dependent. Spencer has a salaryof $39,000 and itemized deductions of $4,000. Taxes withheld duringthe year amount to $3,221. On July 14 of the current year, he soldthe following assets: -Spencer received a K-1 from a partnershipindicating that his share of the partnership STCL is $200 -Land wassold for $35,000. The land was received as a property settlement onJanuary 10,2001, when the land's FMV amounted to $30,000. Hisex-wife's basis for the land, purchased on January 10, 1991, was$18,600. -A personal-use computer acquired on March 2 last year for$4,000 was sold for $2,480. -A membership card for a prestigiouscountry club was sold for $8,500. The care was acquired on October10,1993, for $6,000. -Marketable securities held as an investmentwere sold for $20,000. The securities were inheritied from hisuncle, who died on March 10 of the current year when FMV of thesecurities was $21,000. The uncle purchased the securities on May10, 1990, for $10,700. In addition to the above sales, Spencerreceived a $100 refund of state income taxes paid last year.Spencer used the standard deduction last year to computer his taxliability. Prepare Form 1040 and Schedule D for the currentyear.