Reference no: EM132810933

Question - Peter Greenway is married. He is employed as an architect and wants to determine his taxable income. He correctly calculated his AGI, however, first needs to compute his taxable income. He provided the following information with hopes that you could use it to determine her taxable income.

a. Peter paid $8,700 for medical expenses for care from a car accident.

b. Peter paid a total of $2,800 in health insurance premiums during the year (not through an exchange) and was not reimbursed by his company. Besides the health insurance premiums and the medical expenses for her broken ankle, Peter had other medical expenses of $3,000.

c. Peter had $2,800 of state income tax, $9,495 of Social Security tax, and $23,500 of federal income tax withheld from his pay throughout the year.

d. In 2020, Peter was due a refund of $1,250 for overpaying his 2019 state taxes. On the 2019 state tax return that he filed in April of 2020, he applied the overpayment towards his 2020 state tax liability. He estimated that his state tax liability for 2020 will be $4,500.

e. Peter paid $3,200 of property taxes on his personal residence. He also paid $800 to the developer of his subdivision to replace the sidewalk in certain areas of the subdivision.

f. Peter has a home mortgage loan in the amount of $310,000 that he secured when he purchased the home. The home is worth about $450,000. Peter paid interest of $14,800 in interest on the loan this year.

h. Peter made several charitable contributions throughout the year. He contributed stock in ZYX Corp. to the Red Cross. On the date of the contribution, the FMV of the donated shares was $1,300 and his basis in the shares was $600. Peter originally bought the ZYX Corp. stock in 2007. He also contributed $250 cash to Johnson University and religious artifacts he held for several years to the church. The artifacts were valued at $700 and Peter's basis in the items was $400. Peter also contributed $1,400 of services to her church last year.

i. Peter paid $350 in investment advisory fees and another $200 to have his tax return prepared (the $200 payment was made in 2020 to have his 2019 tax return prepared).

j. Peter is involved in playing poker as a hobby. During the year, he won $2,600 in poker games and incurred $5,000 in expenses. He has never had a profitable year with his poker activities, so he acknowledges that this is a hobby for federal income tax purposes.

Required - Determine Peter's taxable income and complete page 1 of Form 1040 (through taxable income, line 11b) and Schedule A assuming his AGI is $245,000.