William and Wilma B. Foxworthy were married in 1994 and will file a joint return for 2015. Their oldest son, William (Bill), attended UCSD on a full…

William and Wilma B. Foxworthy were married in 1994 and will file a joint return for 2015. Their

oldest son, William (Bill), attended UCSD on a full football scholarship valued at $18,500. The

Foxworthy’s contributed Bill’s only other support in the form of spending money in the amount of

$5,000. Their other child, Melissa, is an 18-year-old high school student who lives at home and worked

part-time. Nearly all of Melissa’s earnings of $4,500 were placed into savings for college. William

was employed full-time and Wilma was employed part time during 2015. Their earnings are as

follows:

William Foxworthy, Car Mechanic $ 44,000

Wilma B. Foxworthy, RN Sharp Hospital 55,000

Federal taxes of $4,400 and $6,750 respectively were withheld from their wages.

Wilma’s Mom passed away and in 2010 she received a sizable inheritance. The inheritance is all

invested in stocks, bonds and Treasury bills. The 2015 income is summarized as follows:

Interest income:

U.S. Treasury Bills $ 5,800

Charles Schwab – Interest (taxable) 1,200

Charles Schwab – Interest (muni’s) 3,000

Dividends:

AT&T 4,500

Ford Motor Corporation 2,500

Royal Dutch Shell (A publicly traded foreign corporation) 2,700

Foreign taxes withheld 260

William and Wilma will itemize their deductions for 2015. Their records reveal the following:

Medicines and drugs 1,400

Other medical – hospital/doctor’s 12,400

Medical expense reimbursement (Wilma’s §125 plan) 3,500

State and local sales taxes 1,350

State and local income taxes 4.500

Real estate (property) taxes 6,500

Interest on home mortgage 13,500

Other interest—Credit cards 1,350

Charitable contributions (cash) 2,100

Tax return preparation fees for prior year 950

Political contributions to a national candidate for office 250

Forms required to complete and submit for William and Wilma B. Foxworthy based on the above

information:

1. 1040

2. 1040, Schedule A

3. 1040, Schedule B

4. Form 8879 (e-file Signature Authorization)

Download forms for 2015 from irs.gov

For this problem, all of the dividends received are qualified dividends