Rhonda Hill’s 2014 federal income tax return

Comprehensive Individual Tax Return
ACC 331-501 (Fall 2015)

• Use the following information to complete Rhonda Hill’s 2014 federal income tax return. If information is missing, use reasonable assumptions to fill in the gaps.
• The forms, schedules, and instructions can be found at the IRS website (www.irs.gov). The instructions can be helpful in completing the forms.
• You may purchase a tax software program to complete the return.
• The return must be completed and printed in the form that the client (Rhonda Hill) would file with the IRS.
• Do NOT complete any state tax returns.
Facts:
• Rhonda Hill (unmarried) is employed as an office manager at the main office of Carter and Associates CPA firm. Rhonda lives in a home she purchased 20 years ago. Rhonda’s older cousin, Mabel Wright, lives with Rhonda in the home. Mabel is retired and receives $2,400 of Social Security payments each year. Mabel is able to save this money because Rhonda provides all of Mabel’s support. Rhonda also provided you with the following information:
• Rhonda does NOT want to contribute to the presidential campaign.
• Rhonda lives at 1234 Blue Ridge Way, Tulsa, OK 74101
• Rhonda’s birthday is ***** and her SSN is###-##-####• Mabel’s birthday is ***** and her SSN is###-##-####• Rhonda does not have deposits in foreign bank accounts or trusts.• Rhonda received a W-2 from Carter and Associates with the following:
Line 1 Wages - $72,000; Line 2 Federal income tax withheld - $9,300; Line 3 SS Wages - $72,000; Line 4 SS tax withheld - $3,024; Line 5 Medicare Wages - $72,000; Line 6 Medicare tax withheld - $1,044; Line 16 State Wages - $72,000; and Line 17 State income tax withheld - $2,700
• Rhonda received $250 in interest from Tulsa City bonds, $120 interest from IBM bonds, and $15 from her savings account at UCU Credit Union. She also received a $460 dividend from Huggies Company and $500 from Bicker Corporation. Both dividends are qualified dividends.
• Rhonda sold 200 shares of DM stock for $18 per share on June 15, 2014. She purchased the stock on December 12, 2007, for $10 per share. She also sold 50 shares of RSA stock for $15 per share on October 2, 2014. She purchased the stock for $65 per share on February 2, 2014. The stock basis amounts have been reported to the IRS.
• The following is a record of the medical expenses that Rhonda paid for herself during the year. The amounts reported are paid in excess of insurance reimbursements: Insurance premiums - $900; Prescription Medicine - $100; Over-the-counter medication - $250; Doctor and dentist visits - $485; Eyeglasses - $300; and Physical Therapy - $200.
• Rhonda paid $2,800 in mortgage interest during the year to UCU Credit Union. She also paid $1,200 in real property taxes during the year.
• Rhonda contributed $2,350 to Heavenly Church during the year. Heavenly Church’s address is***** Tulsa, OK 74101.
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