Daniel B. Butler and Freida C. Butler, husband and wife, file a joint return. The Butlers live at 625 Oak Street in Corbin, KY 40701. Dan’s Social Security number is 111-11-1111, and Freida’s is 123-45-6789. Dan was born on January 15, 1965, and Freida was born on August 20, 1966.
During 2016, Dan and Freida furnished over half of the total support of each of the following individuals, all of whom still live at home:
a. Gina, their daughter, age 22, a full-time student, who married on December 21, 2016, has no income of her own and for 2016 did not file a joint return with her husband, Casey, who earned $10,600 during 2016. Gina’s Social Security number is 123-45-6788.
b. Sam, their son, age 20, who had gross income of $6,300 in 2016, dropped out of college in October 2016. He had graduated from high school in May 2016. Sam’s Social Security number is 123-45-6787.
c. Ben, their oldest son, age 26, is a full-time graduate student with gross income of $5,200. Ben’s Social Security number is 123-45-6786.
Dan was employed as a manager by WJJJ, Inc. (employer identification number 11-1111111, 604 Franklin Street, Corbin, KY 40702), and Freida was employed as a salesperson for Corbin Realty, Inc. (employer identification number 98-7654321, 899 Central Street, Corbin, Ky 40701). Selected information from the W–2 Forms provided by the employers is presented below. Dan and Freida use the cash method.
Line
Description
Dan
Freida
1
Wages, tips, other compensation
$74,000
$86,000
2
Federal income tax withheld
11,000
12,400
17
State income tax withheld
2,960
3,440
Freida sold a house on December 30, 2016, and will be paid a commission of $3,100 (not included in the $86,000 reported on the W–2) on the January 10, 2017 closing date.
Other income (as reported on 1099 Forms) for 2016 consisted of the following:
Dividends on CSX stock (qualified)
$4,200
Interest on savings at Second Bank
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