Federal Tax Income return

VADER MAUL & CO. CERTIFIED PUBLIC ACCOUNTANTS

You don’t know the power of the Dark Side of Accounting!

MEMORANDUM

DATE: January 21, 2015

FROM: Jabba D. Hutt, Tax Partner

TO: Droid 3327

MATTER: Anakin Skywalker and Padmé Amidala Filing Status

As you know, Anakin Skywalker and Padmé Amidala married secretly several years ago in Naboo, a planet without community property laws. Although Padmé insisted in having a prenuptial agreement, Anakin convinced her that a prenuptial agreement would cast a dark cloud over their marriage. As a result, they abandoned the idea of a prenuptial agreement and married without one.

Anakin and Padmé left Naboo with nothing. After years of work they were able to save enough money for a down payment and bought a house in Horizon City, Texas. They moved into their new home in 2009, just after the birth of their twins, Luke and Leia. Since coming to Texas, Anakin and Padmé have filed their federal income tax returns as Married Joint.

For years Emperor Palpatine has been telling Anakin that filing Married Joint makes them subject to the marriage penalty and hi gher taxes. Palpatine insists that they should file Married Separate to pay less taxes. Anakin and Padmé have decided to follow Palpatine’s advice and will file thei r 2014 tax returns as Married Separate. Anakin has asked for guidance on the proper allocation of income, expense, and tax payments to each of the separate returns.

The information for the 2014 return of the couple appears on the following page. Prepare a Research Memorandum discussing the allocation of income, expense, and withholding items to each of the returns to be filed by Anakin and Padmé in 2014.

Please let me know if you have any questions.

ANAKIN SKYWALKER AND PADME AMIDALA 2014 INCOME TAX INFORMATION

Anakin Skywalker Padmé Amidala DOB: July 4, 1987 DOB: December 28, 1978 SSN: 444-38-1987 SSN: 444-79-1977

Luke Skywalker Leia Skywalker DOB: January 9, 2009 DOB: January 9, 2009 SSN: 444-20-0120 SSN: 444-20-0121

(1) Wages earned by Anakin-$52,000 FIT withholding-$2,500

(2) Wages earned by Padmé-$75,000 FIT withholding-$5,700

(3) Interest Income paid by the Galactic Empire Credit Union (GECU) Anakin’s Savings Account-$250

Funded by Anakin Padmé’s Savings Account-$350

Funded by Padmé Joint CD-$500

Funded by Padmé

(4) Expenses Related to the home Deed and Mortgage shows Anakin as the owner

Property Taxes-$8,700 Paid by Padmé

Mortgage Interest-$10,556 Paid by Anakin

Mortgage Insurance-$4,800 Paid by Padmé

Casualty Insurance-$3,800 Paid by Padmé

Life Insurance on Anakin’s life to pay the mortgage-$2,412 Paid by Anakin

(5) Prize winnings from Anakin’s speed racer competitions-$7,500 Expenses incurred by Anakin in speed racing-$27,890

(6) Daycare expenses paid by Padmé-$300 per month for each child Daycare Information

Universal Daycare (EIN 75-5759873) 501 W. University Ave. El Paso, TX 79968