58. Jane Smith, age 40, is single and has no dependents. She is employed as a legal sec- retary by Legal Services, Inc. She owns
and operates Typing Services located near the campus of Florida Atlantic University at 1986 Campus Drive. Jane is a material participant in the business. She is a cash basis taxpayer. Jane lives at 2020 Oakcrest Road, Boca Raton, FL 33431. Jane's Social Security number is 123-45-6789. Jane indi cates that she wants to designate $3 to the Presidential Election Campaign Fund. Jane had health insurance for all months of 2016. During 2016, Jane had the follow- ing income and expense items a. $100,000 s b. $20,000 gross receipts from her typing services business c· $700 interest income from Third National Bank d. $1,000 Christmas bonus from Legal Services, Inc. alary from Legal Services, Inc. $60,000 life insurance proceeds on the death of her sister f. $5,000 check given to her by her wealthy aunt. g. $100 won in a bingo game. h. Expenses connected with the typing service Office rent Supplies Utilities and telephone Wages to part-time typists Payroll taxes Equipment rentals $7,000 4,400 4,680 5,000 500 3,000 i. $9,500 interest expense on a home mortgage (paid to San Jose Savings and Loan). j. $15,000 fair market value of silverware stolen from her home by a burglar on October 12, 2016. Jane had paid $14,000 for the silverware on July 1, 2007. She was reimbursed $1,500 by her insurance company k. Jane had loaned $2,100 to a friend, Joan Jensen, on June 3, 2013. Joan declared bankruptcy on August 14, 2016, and was unable to repay the loan. Assume that the loan is a bona fide debt Legal Services, Inc., withheld Federal income tax of $16,000 and the appropriate amount of FICA tax from her wages 1. m. Alimony of $10,000 received from her former husband, Ted Smith
