PREPARE A 2019 RETURN 1.Thomas McNeil is employed as an airline pilot for Rocky Mountain Airlines in Denver, CO. Rachel is a business consultant.  . Thomas and Rachel have three children who live with the,. b. Thomas and Rachel live at 21905 Inspiration Dr., Henderson, CO 80022 c. Thomas’s birthday is 10/12/1972 and his Social Security number is 555-55-5551 d. Rachel’s birthday is 7/16/1975 and her Social Security number is 444-44-4442 e. Robert’s birthda

Use the following information to complete Thomas and Rachel McNeil’s Joint 2019

PREPARE A 2019 RETURN

1.Thomas McNeil is employed as an airline pilot for Rocky Mountain Airlines in Denver, CO.
Rachel is a business consultant.  . Thomas and Rachel have three children who live with the,.


b. Thomas and Rachel live at 21905 Inspiration Dr., Henderson, CO 80022
c. Thomas’s birthday is 10/12/1972 and his Social Security number is 555-55-5551
d. Rachel’s birthday is 7/16/1975 and her Social Security number is 444-44-4442
e. Robert’s birthday is 6/30/2003 and his Social Security number is 454-54-5454
f. Denise’s birthday is 8/12/2005 and her Social Security number is 343-43-4343
g. Sara’s birthday is 5/13/2009 and her Social Security number is 232-32-3232

2. Thomas and Rachel received $550 in interest from City of Denver municipal bonds, $1,070
interest from US Treasury bonds, and $65 from their savings account at SCD Credit Union.
Thomas and Rachel are joint owners of the City of Denver bonds and the US Treasury bonds.
They have a joint savings account at SCD Credit Union.

3. Rachel was involved in a car accident. The other
driver’s insurance company paid Rachel $1,350 for medical expenses relating to her injuries
from the accident and $300 for emotional distress from the accident. She received payment
during the tax year.

4. Thomas’s father died, and Thomas received a $100,000 death benefit from his father’s life
insurance policy.

5. Thomas and Rachel received a federal income tax refund of $975 from their 2018 federal
income tax return in 2019. Thomas and Rachel did not itemize deductions in on their 2018
Return.

6. Thomas’s aunt Beatrice gave Thomas $18,000.

7. Rachel won an iPad valued at $500 in a raffle at the annual fair held at Denise’s high school.

8. Thomas and Rachel have qualifying insurance for the entire family for the purposes of the
Affordable Care Act (ACA).

9. Thomas goes gambling with some buddies on New Year’s Day of the tax year and wins
$2,300 on a slot machine. However, he did not receive a W-2G for his winnings.

10. Rachel owns Mountainview Consulting, LLC, a business consulting prace. She earned
total gross receipts (revenue) for the year from her tour guide business of $56,235. She
uses the cash method of accounting. She was not issued a 1099-MISC or a 1099-K. The total
revenues match the bank deposits she made for the year. Rachel is a sole proprietor and
reports on the cash basis of accounting. Her her office address is: 975 Twisty Pines Ln,
Denver, CO 80205. Her business is classified as a personal service and can be listed under
“Other Services” with a business code of 999999. 

11. From June 1 to December 31, Rachel incurred the following business operating
expenses:
Advertising $4,550
Insurance Expense 2,350
Interest Expense from loan 675
Legal/Accounting Exp 4,780
Office rent 18,200
Supplies 925
Meals (Client Business Lunches) 500

Rachel did not pay any individuals for services, so she is was not required to issue any 1099-
MISC forms for this year.

12. Rachel also had the following start-up expenses for her business that she incurred during
the year:

Legal Consulting Fees 3,500
Accounting/Advisory Fees 1,050


13. Thomas and Rachel paid $24,000 in total mortgage expenses. Within these payments
were $2,500 of property tax for the residence and $8,900 in interest expense. See attached
Form 1098-MTG issued by their mortgage company.

14. Thomas and Rachel had $15,200 of additional medical expenses. This does not include the
amounts used for injuries where they received reimbursement of their medical bills.

15. Thomas and Rachel own two vehicles a 2018 Ford Explorer and an Audi S4 2017 model.
They paid $1,200 to register the Explorer. Of this $1,200 registration amount, $800 (i.e.
$800/1,200) was in ownership tax and $400 (i.e. $400/$1,200) was in fees. They paid $1,400 to

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register the Audi. Of that $1,400 registration amount, $1,100 was is ownership tax and $300
was in fees.

16. Thomas graduated from Metropolitan State University in 1995 and is a proud supporter of
his Alma mater. He donated cash of $7,000 to their scholarship fund. The scholarship fund is
appropriately classified as a charitable 501(c)(3) non-profit organization.

17. Rachel supports the Denver Dumb Friends league and donated $11,000 (cash) to them.
The Denver Dumb Friends League is registered as a charitable 501(c)(3) non-profit
organization.

18. Thomas had $5,724 of Colorado tax withheld during the 2019 year. This amount was
reported on his W-2. Please answer “no” for all the questions under Filing & Estimate Payments
under the Deductible Taxes Paid section when asked.

19. Thomas contributed $5,500 to his Roth Individual Retirement Account (Roth IRA). Rachel
has also contributed $5,500 to her Roth IRA as well. They have no excess contributions from
this year nor from prior years.