Assignment- Tax Return Preparation

The purpose of the tax return problem is to help you integrate the bits and pieces of tax law that we discuss in each chapter into a comprehensive whole. Each return provides a visual model that should help you understand how the various technical issues affect the calculation of a taxpayer's income tax base and tax liability. You should also become familiar with income tax compliance through the preparation of relatively simple tax returns. Ultimately you should see how an individual taxpayer is affected by investments in regular corporations, partnerships and subchapter S corporations and how those different tax entities are treated under U.S. income tax law.

You must use the taxpayers' information in the Tax Return Case Study and work on sections of the tax returns as we finish the related chapters:

Part	Assignment	2006 Forms
1	Income (inclusions/exclusions)- use the taxpayers' information to complete the revenue portion of page 1 of the tax returns for the entities.	Form 1065 Form 1120 Form 1120S
2	Deductions (allowed/disallowed/business)- use the taxpayers' information to complete the deduction's portion of page 1 of the tax returns for the entities.	Form 1065 Form 1120 Form 1120S
3	Property Transactions (capital)- use the taxpayers' information to complete Schedule D and Schedule K (for 1065 & 1020S) and update page 1 of the tax tax returns for the entities.	Form 1065 Form 1120 Form 1120S
4	C Corporation Tax Return- use the taxpayer's information to complete the Form 1120 and the Excel tax worksheet.	Form 1120
5	Partnership Tax Return- use the taxpayer's information to complete the Form 1065, Ms. Maine's Schedule K-1, and the Excel tax worksheet.	Form 1065
6	S Corporation Tax Return- use the taxpayer's information to complete the Form 1120S, Ms. Maine's Schedule K-1, and the Excel tax worksheet.	Form 1120S
7	Individual Income Tax Return- use the taxpayer's information and the various source documents to complete the taxpayer's Form 1040.	Form 1040

You must download the taxpayer information from the course WEB pages and the necessary tax return forms from the IRS web page. Note that you are going to prepare only the forms listed in the material, NOT all of the forms that would be required by the IRS. The returns for parts 1 - 3 will be graded at the beginning of class on the due dates listed on the Daily Schedule web page; The completed tax return is due at the scheduled time for the final examination.

You should prepare the initial assignments (parts 1 - 3) using pencil, but all forms in the final return must be completed in ink. (Note that the last return, a Form 1040 for an individual, is due at the start of the final exam period.) Grading will be done in class and is based on your ability to properly complete the required forms.

Use this form to report the scores that you earned for each of the 6 parts of the tax return task. You must report your scores within 48-hours of the end of the class in which the part was graded. (Your answers on part 7 will be submitted through a separate web page.)