cash-basis home cleaning business

Assignment Print View 10/28/19, 9:37 AM
https://ezto.mheducation.com/hm.tpx?todo=c15SinglePrintView&singl…252711846783191&role=student&pid=27923627_3645527157_1_113835700 Page 1 of 2
1.
Cassi (SSN 412-34-5670) has a cash-basis home cleaning business she runs as a sole proprietorship. The following are the results from business operations for the tax
year 2018:
Gross receipts $203,000
Business mileage: 27,000 (miles incurred ratably throughout the year) 35,000 miles total during
the year 2018
Van (over 6,000 lbs) placed in service 1/01/18, cost 27,000
Postage (500)
Wages (26,000)
Payroll taxes (1,950)
Supplies (12,500)
Phone (1,250)
Internet service (600)
Rent (2,400)
Insurance (2,800)

Van expenses (4,500)

Business assets Date Purchased Cost
Computer 1 5/18/18 $ 2,200

Computer 2 6/01/18
Printer 3/01/17
Copier 3/02/17
Furniture 3/01/17

2,700
900
2,100
6,000
Determine Cassi’s self-employment income and QBI deduction. Prepare Schedule C and Schedule SE. § 179 expense is elected on all eligible assets (§ 179 was not
taken on assets purchased last year). (Use Table 6A-1)
(Input all the values as positive numbers. Use Rounded values for tax computation. Do not round other intermediate computations. Round your final
answers to nearest whole dollar.)
Assignment Print View 10/28/19, 9:37 AM
https://ezto.mheducation.com/hm.tpx?todo=c15SinglePrintView&singl…252711846783191&role=student&pid=27923627_3645527157_1_113835700 Page 2 of 2
rev: 03_28_2019_QC_CS-164354, 04_10_2019_QC_CS-165695
!! QBI Form 4562 P1 “”
Schedule C page 1 and Schedule SE page 2 for a single taxpayer with no dependents.
Page 1 of Schedule SE.

Schedule C QBI Schedule SE Form 4562 P1 Form 4562 P2
SCHEDULE SESelf-Employment TaxOMB No. 1545-0074
(Form 1040) 2018
Department of the Treasury – Internal Revenue ▶ Go to www.irs.gov/ScheduleSE for instructions and the latest information.
Service (99) ▶ Attach to Form 1040 or Form 1040NR. Attachment Sequence No. 17
Name of person with self-employment income (as shown on Form 1040) Social security number of person with self
employment income ▶
Before you begin: To determine if you must file Schedule SE, see the instructions.
May I Use Short Schedule SE or Must I Use Long Schedule SE?
Note. Use this flowchart only if you must file Schedule SE. If unsure, see Who Must File Schedule SE in the instructions.
Section A – Short Schedule SE.
1a Net farm profit or (loss) from Schedule F, line 34, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A 1a
b If you received social security retirement or disability benefits, enter the amount of Conservation Reserve Program payments included on
Schedule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code Z 1b
2 Net profit or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and
Schedule K-1 (Form 1065-B), box 9, code J1. Ministers and members of religious orders, see instructions for types of income to report on this
line. See instructions for other income to report 2
3 Combine lines 1a, 1b, and 2 3
4 Multiply line 3 by 92.35% (0.9235). If less than $400, you do not owe self-employment tax; do not file this schedule unless you have an
amount on line 1b 4
Note. If line 4 is less than $400 due to Conservation Reserve Program payments on line 1b, see instructions.
5 Self-employment tax. If the amount on line 4 is:
● $128,400 or less, multiply line 4 by 15.3% (0.153). Enter the result here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55
● More than $128,400, multiply line 4 by 2.9% (0.029). Then, add $15,921.60 to the result.
Enter the total here and on Schedule 4 (Form 1040), line 57, or Form 1040NR, line 55 5
6 Deduction for one-half of self-employment tax.
Multiply line 5 by 50% (0.50). Enter the result here and on Schedule 1 (Form 1040), line 27, or
Form 1040NR, line 27 6
For Paperwork Reduction Act Notice, see your tax return instructions. Schedule SE (Form 1040) 2018
UYA
THIS FORM IS A SIMULATION OF AN OFFICIAL U.S. TAX FORM. IT IS NOT THE OFFICIAL FORM ITSELF. DO NOT USE THIS FORM FOR
TAX FILINGS OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL. © 2019 McGraw-Hill Education.

Leave a Reply

Your email address will not be published.