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The Following Data Relates To Maryann's Prior Year Income

Maryann Miller is contemplating marriage to Peter Pearson. She wants to understand the tax implications of marriage. Maryann lives with her father Joe and pays the household expenses. She earned $69,500 in salary last year. Peter owns a home valued at $488,000 with a $220,000 mortgage. He earned $89,000 in salary last year and pays $1,500 in monthly child support. The director has requested an executive summary analyzing at least 4 scenarios and recommending a position, with assumptions and sources stated.

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Rahul
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47 views

The Following Data Relates To Maryann's Prior Year Income

Maryann Miller is contemplating marriage to Peter Pearson. She wants to understand the tax implications of marriage. Maryann lives with her father Joe and pays the household expenses. She earned $69,500 in salary last year. Peter owns a home valued at $488,000 with a $220,000 mortgage. He earned $89,000 in salary last year and pays $1,500 in monthly child support. The director has requested an executive summary analyzing at least 4 scenarios and recommending a position, with assumptions and sources stated.

Uploaded by

Rahul
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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The following information relates to one of our client: Maryann Miller.

Maryann is
contemplating marriage and wants to know the tax ramifications of this. The director of the
Firm has requested that you research this situation and deliver and executive summary. It is
expected that you provide calculations relating to at least 4 possible scenarios and identify
the position that should be recommended to the client. State all your assumptions and make
sure to provide evidence to support your position.
Maryann Miller is single, 28 years old, and lives with her father, Joe, who is 68 years old. Joe is
retired and receives social security in the amount of $1,282 per month which he deposits into
a savings account. That is his only income. Joe own his home which as a fair market value of
$274,000 but Maryann pays all the monthly expenses of the household.
The following data relates to Maryann's prior year income:

Salary
Fed Taxes Withheld
State Taxes Withheld
Local Taxes Withheld
Interest Income
Dividend Income
20xx Med Health Insurance Paid
20xx Medical Expenses Paid
Real Estate Taxes on Home (9/2/xx)

$69,500
$7,800
$2,641
$695
$895
$1,250
$2,160
$3,100

20xx Church Contributions


United Way Contributions (7/3/xx)
American Red Cross (10/5/xx)
Tsunami Relief Fund (1/16/xx)

$2,100
$350
$400
$250

$5,200

Maryann is engaged to Peter Pearson. Peter is 33 years old and purchased a home in 2007 for
$300,000. He has a mortgage on the house of $220,000. The current value of the home is
$488,000. Peter is divorced an has a son, James, age 4 who lives with his mother Betty. Betty
has remarried Barry Bellows. Peter pays $1,500 a month child support and per his divorce
agreement he is entitled to claim James as his dependent.
The following data relates to Peter's prior year income:

Salary
Fed Taxes Withheld
State Taxes Withheld
Local Taxes Withheld
Interest Income
Dividend Income
20xx Med Health Insurance Paid
20xx Med Health Insurance James

$89,000
$14,000
$3,382
$890
$1,700
$2,300
$2,400
$680

Mortgage Interest Paid


$19,000
Real Estate Taxes on Home (9/2/xx)
$6,000
20xx Church Contributions
Child Support Paid

$3,000
$18,000

Grading Rubric
The comprehensive problems will require you to interpret the tax law and apply it to a given
set of circumstances. You will be provided with fundamental information upon which you must
make assumptions and determinations that will form the basis for the tax position that you
will recommend to the client. You must state your assumptions and cite all of your sources to
support your position.

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