Reference no: EM133018367

Profile Assignment

Family:
Martin Dorne, SIN 499499499
Address: 150 Humber College Blvd, Etobicoke Ontario M1M1M1 Phone number 416-675-6622
He has no foreign income
He has not sold a principal residence during the year

Brian Lassiter, SIN 994994994 Same address and phone number

Martin Dorne born on Jan 15,1966 and is employed in construction work by a large public company. His annual salary is $98,500 in 2020, none of which involves commissions. As the company was very successful during 2020, Martin has been provided with a $15,000 bonus. This bonus was paid $7,000 in December 2020, and the rest in February 2021.

Martin's employer withheld maximum EI premiums and CPP contributions, along with $18,000 in federal income taxes. Other amounts withheld by his employer are as follows:

CPP/EI max

RPP Contributions                                                                    $4,300

Union Dues                                                                                    450

Martin's common-law partner is Brian Lassiter. Brian was born on Feb 5, 1970 and is legally blind. Brian has 2020 income from investments of $500.

Martin and Brian adopted three orphaned brothers from a war torn country 8 years ago. Information on these brothers is as follows:

David Dorne, Birth date Mar 3, 2004, in good health, and has income from part time jobs of $10,500. Devon Dorne Birth date Apr 8, 1999 and has serious breathing problems that prevent him from working on a full time basis. He has got a doctor's letter attesting that his condition is serious but he does not have a "marked" restriction of daily activities. He lives with Martin and Brian and has income from part time jobs of $5,150.

Derek Dorne Birthdate May 15, 1997 and attends university on a full time basis for 8 months of the year. Martin pays his tuition fees of $14,300, along with textbook costs of $1,200. He lives with Martin and Brian and is in good health. He has self-employed income of $13,500. Assume he pays no CPP contributions on this income. He would like to transfer his tuition credit to Martin.

Other Information:
1. During 2020, Martin spent $12,300 on employment related meals and entertainment with clients of his employer. His employer reimbursed $7,300 of these costs.

2. During 2020, Martin makes his regular annual contribution of $2,000 to a registered charity, The Shepherds Of No Hope. (Martin is a very pessimistic individual.)

3. The family's 2020 medical expenses, all of which were paid by Martin, were as follows:

Martin and Brian	$ 2,200
David	1,700
Devon	10,600
Derek	4,500

4. Martin received options to purchase 500 shares of his employer's stock at a price of $45 per share 2 years ago. At the time the options were granted, the market price of the shares was $50 per share. During July, 2020, when the shares are trading at $70 per share, Martin exercises all of these options. He is still holding these shares on December 31, 2020.

6. During 2020, Martin receives several gifts from his employer:
• In recognition of his 10 years of service, Martin receives an engraved wrist watch. The retail value of this watch is $800.
• At Christmas, all of the company's employees receive a gift box of vintage wines. The retail value of these wines is $400.

Required:

A. Create a profile file, for Martin.

B. Determine Martin's minimum Net Income and taxable income for the 2020 taxation year.

C. Based on your answer in Part B, determine Martin's federal Tax Payable and amount owing (refund) for the 2020 taxation year.

D. In order to submit this assignment, first of all save the file!! Then, you must create a PDF file (you should either be able to Save as PDF, or print to PDF. Do not submit the file as a Profile file.

E. Email this file to me thru Course messages in Blackboard.