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Received qualified dividends of $600 from Blue Corporation, $750
from Green Corporation, and $368 from Orange Corporation. Each
corporation
reported dividend payments on a Form 1099–DIV.
Received child support of $15,000 during the year.
Received a $900 income tax refund from the state of Maryland on
April 29, 2014.
Reported total itemized deductions of $10,200 on 2013 federal
income tax return, which included $2,200 of state income tax
withheld by her employer.
Received K-1 indicating her share of the clothing boutique’s ordinary
business income (loss) – Line 1 is $23,580. No guaranteed payments
were made or
dividends were received by the partnership.
Acquired 100 shares of Ace Corporation common stock for $30 a
share on January 12, 2014. She sold the stock on December 19 for
$55 a share.
Paid $1,300 for prescription medicines and $1,875 in physician and
hospital bills. Medical insurance premiums were paid by her
employer.
Paid real property taxes of $1,675 on her personal residence and
interest on her home mortgage was $4,285, and interest paid to credit
card companies
totaled $360.
Contributed $25 each week to her church and $15 each week to
United Way.
Paid $1,500 in estimated federal income taxes throughout the year.
Artifact Three: Tax Memo II Corporation Issue
Clifford Company has encountered the following issue:
The company would like to make a property distribution (dividend) of
the three machines that it uses in its business. It no longer needs two
of these machines.
All three machines have a fair market value of $20,000 each. The
basis of each machine is as follows: Machine A, $27,000; Machine B,
$20,000; and Machine C,