Question

Evie Adams Using the tax software, complete the tax return, including Form1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario. Note: When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice. Interview Notes • Evie is single and has two young girls, Poppy and Lily, who lived with her all year. • Evie paid more than half of the support for her daughters and all the cost of keeping up the home. • Evie was unemployed for two months (March and April). She cashed in her 401(k) and used the money to pay for living expenses. • Evie is paying off a student loan that she took out when she attended college for her bachelor's degree. • She took some courses this year at Southwest College to improve her job skills as an educator. She did not receive a Form 1098-T for 2018. • Evie was an elementary school teacher from May to December and paid $550 out of pocket for classroom supplies. • She went to the local casino and won some money in 2019. During the interview she mentions that she had gambling losses of $700.20. What is the total amount of adjustments on Evie's tax return?a. $250 b. $600 c. $850 d. $1,550

Answer 1

Answer:The answer is a $250

Explanation:

Since she won some money in local casino, and during the interview she reported that she had gambling losses of $700.20, The gambling losses is regarded as income, Therefore total income = $700.20

Adjustment or above the line deduction are

Educator expenses $550

Amount she cashed and use to pay for living expenses 401(k)

To find the total amount of adjustment, we subtract the above the line deduction from income

401 + 550 = 951

Therefore. 951 - 700.20

= 250.8

The amount for deduction to the nearest dollar is $250