Assignemnt

Prepare the 2015 Federal Tax Return for Mr. Herb Pu (SS# 576-11-0002) address 123 University Ave., Honolulu, HI 96833

With the following information:

· Sold 100 shares of W Corp. for $6,250 on 7/1/15, Purchased on 7/1/08 for $5,000.

· Sold 100 shares of X Corp. for $1,500 on 8/1/15, Purchased on 5/1/15 for $1,000.

· Tom a friend died on 7/1/15. Tom had no money when he died but owed Mr. Pu $4,000 which he borrowed on 7/1/10. Tom signed a 4% Note Payable to Mr. Pu.

· Salary income of $48,000 with federal tax withholdings of $10,000., State withholdings of $4,500, FICA withholdings of $3,100 and Medicare withholdings of $725.

· Age 70

· Social Security benefits of $10,000.

· Mr. Pu's wife died 5/31/2014.

· Mr. Pu's son Sam lives with him and is 21 years old and attends HPU full time. Sam has a part time job which paid him $6,500 during 2015.

· Mr. Pu also has a son Robert who lives with him and was born on 6/25/2009.

· Mr. Pu got hurt at his job on 2/25/15 and received $5,000 in Worker's Compensation benefits.

· Mr. Pu's employer paid his health insurance premiums of $6,500 in 2015.

· Mr. Pu sued a TV Station for showing his picture on TV. He received $1,000 for emotional distress, and $5,000 in punitive damages.

· Mr. Pu paid $5,500 in Alimony to his first wife Joan S.S. # 515-55-0001.

· Mr. Pu owns a Rental house purchase in 2011 for $150,000 for the building and $50,000 for the land. ($200,000 total purchase price) He had the following income and expenses:

· Rental income 10,000
· Property tax 1,500
· Interest expense of 5,000.
· Mr. Pu has the following interest income:
· From Bank of Hawaii $50
· From U.S. Savings Bonds $100
· From Hawaii Muni Bonds $150

· Mr. Pu does art work and sells his paintings at the park. He has made income in 5 of the last 6 years. The following is his list of 2015 income and expenses:

· Art Sales of $8,000.
· Art supplies of $2,000.
· He bought dinner for an art gallery owner, he paid $100 on 11/15/15.
· Rent for his stall at the park $1,000.

· He purchased Art Equipment on 11/15/15 for $4,000. (This is a 7-year property) (Do not use Section 179 depreciation or bonus depreciation)

· He has no inventory at the beginning and end of the year.
· He paid $10,500 for interest on his home.
· He paid $2,600 for property tax on his home.
· In 2015 someone stole his uninsured car which he paid $2,000 for and had a FMV at the time of the theft of $2,500.

Prepare Mr. Pu's 2015 Federal income tax return hand written and list any carryovers and/or carrybacks and any assumptions. Include all tax forms and schedules needed.