Assignment
Kurt and Ashley Tallo (SSNs 412-34-5670 and 412-34-5671), married filing jointly, reside at 1901 Princess Ave., Park City, UT 84060. Ashley does not work outside the home. Kurt's W-2 shows the following:
|
Wages
|
340,000
|
|
Federal withholding
|
76,800
|
|
Social security wages
|
118,500
|
|
Social security withholding
|
7,347
|
|
Medicare withholding
|
6,190
|
|
State withholding
|
23,800
|
The Tallos also have the following:
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Mortgage interest
|
12,600
|
|
Charitable contributions
|
10,000
|
Kurt and Ashley have four passive activities. They received K-1s from four partnerships with the following income or loss on line 1. They are at-risk in each activity, so the passive loss rules are the only obstacle.
|
Activity 1
|
40,000
|
|
Activity 2
|
20,000
|
|
Activity 3
|
10,000
|
|
Activity 4
|
63,000
|
Prepare Form 1040 for the Tallos for 2016. The Taxpayers had qualifying health care coverage at all times during the tax year. You will need Form 1040, Schedule A, Schedule E (page 2), Form 6251, and Form 8582. Do not compute the underpayment penalty, if any.