How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask William Ellis, CPA Your Own Question

William Ellis, CPA
William Ellis, CPA, CPA
Category: Tax
Satisfied Customers: 296
Experience:  Over 15 years of experience in public accounting
50200401
Type Your Tax Question Here...
William Ellis, CPA is online now
A new question is answered every 9 seconds

Tim and Monica Nelson are married, file a joint return, and

Resolved Question:

Tim and Monica Nelson are married, file a joint return, and are your newest tax clients. They provide you with the following information relation to their 2011 tax return:
1. Tim works as a pediatrician for the county hospital. The W-2 form he received from the hospital shows wages of $150,000 and the state income tax withheld of $8,500.
2. Monica spends much of her time volunteering, but also works as a substitute teacher for the local schools. During the year, she spent 900 hours volunteering. When she does not volunteer, she earns 8.00 per hour working as a substitute. The W-2 form she received from the school district shows total wages of $3,888 and state income tax withheld of $85.
3. On April 13, the couple paid $250 in state taxes with their 2010 state income tax return. The Nelson’s state and local sales taxes in 2011 were $5,500
4. On December 18, the Nelsons donated a small building to the Boy Scouts of America. They purchased the building three years ago for $80,000. A professional appraiser determined that the fair market value of the home was $96,000 on December 12.
5. Tim and Monica both received corrective eye surgery, at a total cost of $3,000. They also paid $1,900 in health insurance premiums.
6. On June 1, the couple bought a car for $16,000, paying $4,000 down and borrowing $12,000. They paid $750 total interest on the loan in 2011.
7. On June 10, the Nelsons took out a home equity loan of $20,000 to expand their home. They paid a total of $850 interest with their monthly payments on the loan.
8. The Nelsons paid a total of $2,300 interest on thier4 original home loan.
9. They sold stock in Cabinets, Inc. for $5,200, which they purchased for$7,900 in March of the current year. They also sold stock in the Outdoor Corporation of $12,500 which they purchased several years ago for $8,600.
10. Time incurred the following expenses related to his profession, none of which were reimbursed by his employer:
• Subscription to medical journals $400
• American Medical Association (AMA) Annual membership fee $250
11. During the year, the couple paid their former tax advisor $700 to prepare their prior year tax return
12. The Nelsons do not have children, and they do not provide significant financial support to any family members.


Task
Compute the Nelson’s taxable income for 2011
Answer each problem in detail with reasons, conclusion and results. Submit your anser in a Microsoft word document in not more than 200 words. Show step by step solutions for all calculations with proper tax forms
Submitted: 2 years ago.
Category: Tax
Expert:  William Ellis, CPA replied 2 years ago.

William Ellis, CPA :

Hello and thank you for allowing us at Just Answer to assist you. Give me a few minutes, and I'll have something for you. Thanks, Bill

Customer:

Thank you Bill, you're a lifesaver

William Ellis, CPA :

Just one more minute.

William Ellis, CPA :

Hi, I'm calculating their taxable income to be $100,377. Their net income is comprised of their wages of $153,888 plus their net capital gains of $17,200 including the gain on the real estate they donated. Total is $171,088. Their itemized deductions are $63,311. This is the total of their state income tax, interest from their home loan and heloc, and $51,326 charitable donation of the real estate. The donation is limited to 30% of their AGI. The remainder is carried forward. Their income is too high for them to deduct medical or job expenses.

Customer:

can you tell me what tax forms I would need to show the work. I was thinking 1040, Scedule A and D???

William Ellis, CPA :

That's correct. The donation of the real estate would be reported on Form 8283 with its total flowing to Sch A. The capital transactions are reported on Sch D including the net gain from the property donation. The totals flow to Form 1040.

William Ellis, CPA :

Any questions about this?

Customer:

are there any other forms I would need to show my work?

Customer:

for example is there an IRS form for the Charitable donation?

William Ellis, CPA :

That is Form 8283. Because of the donation, I would file this by paper and include a copy of the appraisal with the return.

Customer:

I don't think I have any more questions at the moment. Thank you so much for all of your help!

William Ellis, CPA :

It's been my pleasure!

William Ellis, CPA, CPA
Category: Tax
Satisfied Customers: 296
Experience: Over 15 years of experience in public accounting
William Ellis, CPA and other Tax Specialists are ready to help you

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
 
 
 
Chat Now With A Tax Professional
William Ellis, CPA
William Ellis, CPA
Tax Professional
296 Satisfied Customers
Over 15 years of experience in public accounting