ACC227 Case 1

1

ACC227

Case 1

Due: September 15, 2021 @ 4PM EST

Ying and Jiang Wu are married and live at 12 Upper River Street in Lakeville, NY 14480. Ying was born on 11/20/1972

and Jiang was born on 7/18/1973. Ying and Jiang’s social security numbers are 798-33-5577 and 315-31-2894,

respectively. Ying works as advertising associate and Jiang is a nurse. Ying and Jiang both work full time and have the

following items of income in 2020:

Ying’s Salary $70,000

Jiang’s Salary 59,000

Municipal bond interest income 900

General Electric bonds interest income 1,000

Chase bank interest income on deposit accounts 600

Gift from Ying’s parents 20,000

Life Insurance proceeds for a policy on Ying’s mother 50,000

Casino winnings reported on a 1099-G 1,200

Ying and Jiang do not have any children nor other dependents in their family, for whom they provide more than half of

the support. They do not have any foreign bank accounts nor any involvement with foreign trusts.

The Wu’s had the following expenditures in 2020:

Medical Expenses not covered by insurance $4,200

Property taxes on personal residence (real estate taxes) 3,400

New York State Income taxes withheld from Ying’s salary 4,200

New York State Income taxes withheld from Jiang’s salary 3,530

Federal Income Taxes withheld from Ying’s salary 9,800

Federal Income Taxes withheld from Jiang’s salary 8,260

Social Security and Medicare taxes withheld from Ying’s salary 5,355

Social Security and Medicare taxes withheld from Jiang’s salary 4,514

Interest paid on a home mortgage 4,000

Contributions to American Lung Association (This is the total of many gifts, all of which were under $250)

850

Contributions to American Red Cross (This is the total of many gifts, all of which were under $250)

150

Parking tickets incurred by Ying 370

Contributions to the political campaign of Alice Johnson who is running for Lakeville Mayor

200

Jiang’s employer provides family health insurance for Jiang’s family members. Although Ying is interested in local

politics, neither Ying nor Jiang have any desire to contribute to the Presidential Election Campaign fund. Ying and Jiang

would like any overpayment of taxes refunded to them. The phone number for Ying and Jiang is 585-555-4289.

Required:

1. Prepare Ying and Jiang’s 2020 Federal income tax forms. Be sure to consult the appropriate instructions for

each form. Instructions are available at www.irs.gov. You may also find more information in the textbook in

chapters we have covered in class and chapters we have not covered in class. You should use the 2020 Tax

Computation Worksheet in the 2020 Tables to determine the amount of federal income tax for 2020. Check

figure: Amount of refund $3,006.