Comprehensive Problem 8-2 Lisa Kohl (age 44) is an unmarried high school princip

Question

Comprehensive Problem 8-2 Lisa Kohl (age 44) is an unmarried high school principal. Lisa received the following tax documents (which are located on separate tabs in the problem): W-2 Form Form 1099-INT Form 1099-DIV Form 1099-B

During the year, Lisa paid the following amounts (all of which can be substantiated):

Home mortgage interest $9,250

KS state income tax payment for 2016 $425

MasterCard interest 550

Life insurance (whole life policy) 750

Property taxes on personal residence 1,425

Blue Cross medical insurance premiums 250

Other medical expenses 780

Income tax preparation fee 300

Charitable contributions (in cash) 730

On January 28, 2017, Lisa sold raw land for $180,000 (basis to Lisa of $135,000). The land was purchased 6 years ago. She received $25,000 as a down payment and the buyer's 10-year note for $155,000. The note is payable at the rate of $15,500 per year plus 8 percent interest. On January 28, 2018, the first of the ten principal and interest payments is due.

Required: Complete Lisa's Form 1040, Schedules A ( especially what is an anwer for line 5 income taxes or general sales taxes ?)

Complete Lisa's Schedule A.

Department of the Treasury Internal Revenue Service (99)

Go to www.irs.gov/ScheduleA for instructions and the latest information.

Attach to Form 1040.

2017

Attachment
Sequence No. 07

467-98-9784

SCHEDULE A
(Form 1040)

Department of the Treasury Internal Revenue Service (99)

Itemized Deductions

Go to www.irs.gov/ScheduleA for instructions and the latest information.

Attach to Form 1040.

OMB No. 1545-0074

2017

Attachment
Sequence No. 07

Name(s) shown on Form 1040
Lisa Kohl Your social security number

467-98-9784

Caution. Do not include expenses reimbursed or paid by others. Medical
and
Dental
Expenses 1 Medical and dental expenses (see instructions) . . . . . . . . . . . . . 1 2 Enter amount from Form 1040, line 38 2 3 Multiply line 2 by 10% (0.10) . . . . . . . . . . . . . . . . 3 4 Subtract line 3 from line 1. If line 3 is more than line 1, enter -0- . . . . . . . . . . 4 Taxes You Paid 5 State and local (check only one box): a   Income taxes, or } . . . . . . . . . . . . . . . . . . 5 b   General Sales Taxes 6 Real estate taxes (see instructions) . . . . . . . . . . . . . . . . . . . . . . 6 7 Personal property taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 8 Other taxes. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 8 9 Add lines 5 through 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Interest You Paid

Note.
Your mortgage interest deduction may be limited (see instructions). 10 Home mortgage interest and points reported to you on Form 1098 10 11 Home mortgage interest not reported to you on Form 1098. If paid to the person from whom you bought the home, see instructions and show that person's name, identifying no., and address _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 11 12 Points not reported to you on Form 1098. See instructions for special rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 Reserved . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 14 Investment interest. Attach Form 4952 if required. See instructions. 14 15 Add lines 10 through 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Gifts to Charity
If you made a gift and got a benefit for it, see instructions. 16 Gifts by cash or check. If you made any gift of $250 or more, see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 Other than by cash or check. If any gift of $250 or more, see instructions. You must attach Form 8283 if over $500 . . . . . . . 17 18 Carryover from prior year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 19 Add lines 16 through 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Casualty and Theft Losses 20 Casualty or theft loss(es). Attach Form 4684. See instructions. . . . . . . . . . . . . . . . . . 20 Job Expenses and Certain Miscellaneous Deductions 21 Unreimbursed employee expenses—job travel, union dues, job education, etc. Attach Form 2106 or 2106-EZ if required. See instructions. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 21 22 Tax preparation fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 23 Other expenses—investment, safe deposit box, etc. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 23 24 Add lines 21 through 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 25 Enter amount from Form 1040, line 38 25 26 Multiply line 25 by 2% (0.02) . . . . . . . . . . . . . . . . . . . . . . . . . . 26 27 Subtract line 26 from line 24. If line 26 is more than line 24, enter -0- . . . . . . . . . . . . . . . . . 27 Other Miscellaneous Deductions 28 Other—from list in instructions. List type and amount _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 28 Total Itemized Deductions 29 Is Form 1040, line 38, over $156,900? No. Your deduction is not limited. Add the amounts in the far right column for lines 4 through 28. Also, enter this amount on Form 1040, line 40. } . . . . 29 Yes. Your deduction may be limited. See the Itemized Deductions Worksheet in the instructions to figure the amount to enter. 30 If you elect to itemize deductions even though they are less than your standard deduction, check here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      For Paperwork Reduction Act Notice, see the Instructions for Form 1040. Cat. No. 17145C Schedule A (Form 1040) 2017

Explanation / Answer

Line 5:

Income taxes: State $425. The following table contains the line numbers and relevant amounts as provided in Form 1040, the lines which are empty is due to lack of information:

Line Amount ($) 1 780 2 3 4 5 425 6 7 1425 8 9 10 9250 11 12 13 14 15 16 17 18 19 20 21 22 300 23 24 25 26 27 28 29 30

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