Ashley Panda lives at 1310 Meadow Lane, Wayne, OH 43466, and her Social Security Tax Computation Problem number Ls 123-45-6789. Ashley Ls single and has a 20-year-old son. Bill. His Social Security number is 111-11-1112. Karl lives with Ashley, and she fully supports him. Bill spent 2018 traveling in Europe and was not a college student. He had gross income of $4,655 in 2018. Bill paid $4,000 of lodging expenses that Ashley reimbursed after they were fully documented. Ashley paid the $4,000 to Bill using a check from her sole proprietorship. That amount Ls not included in the items listed below. Ashley had substantial health problems during 2018, and many of her expenses were not reimbursed by her health insurance.
Ashley owns Panda Enterprises LLC (98-7654321), a data processing service that she operates as a sole proprietorship. Her business is located at 456 Hill Street, Wayne, OH 43466. The business activity code is 514210. Her 2018 Form 1040, Schedule C for Panda Enterprises show’s revenues of $315,000, office expenses of $66,759, employee salary of $63,000, employee payroll taxes of $4,820, business meal expenses (before the 50% reduction) of $22,000, and rent expense of $34,000. The rent expense includes payments related to renting an office ($30,000) and payments related to renting various equipment ($4,000). There is no depreciation because all depreciable equipment owned has been fully depreciated in previous years. No fringe benefits are provided to the employee. Ashley personally purchases health insurance on herself and Bill. The premiums are $23,000 per year.
Ashley has an extensive stock and has prepared the following analysis:
Ashley had $800 of interest income from State of Ohio bonds and $600 of interest income on her Wayne Savings Bank account. She paid $25,000 of alimony to her former husband. His Social Security number is 123-45-6788. Ashley itemizes her deductions and provides the following information, which may be relevant to her return:
Ashley made a $26,000 estimated Federal income tax payment, does not want any of her taxes to finance presidential elections, lias no foreign bank accounts or trusts, and wants any refund to be applied against her 2019 taxes.
Compute Ashley’s net tax payable or refund due for 2018. If you use tax forms for your computations, you will need Form 1040 and its Schedules A, C, D, and SE and Form 8949- Ashley qualifies for the § 199A deduction for qualified business income. Be sure to include that in your calculations.