Betty operates a beauty salon as a sole proprietorship. Betty also owns and rents an apartment building. In 2021, Betty had the following income and expenses. You may assume that Betty will owe $2,624 in self-employment tax on her salon income,
Betty operates a beauty salon as a sole proprietorship. Betty also owns and rents an apartment building. In 2021, Betty had the following income and expenses. You may assume that Betty will owe $2,624 in self-employment tax on her salon income, with $1,312 representing the employer portion of the self-employment tax. You may also assume that her divorce from Rocky was finalized in 2016.
| Interest income | $ 14,975 |
|---|---|
| Salon sales and revenue | 88,760 |
| Salaries paid to beauticians | 46,550 |
| Beauty salon supplies | 23,640 |
| Alimony paid to her ex-husband, Rocky | 7,200 |
| Rental revenue from apartment building | 35,540 |
| 14,100 | |
| Real estate taxes paid on apartment building | 12,060 |
| Real estate taxes paid on personal residence | 6,937 |
| Contributions to charity | 5,029 |
b-1. Complete Schedule 1 of Form 1040 for Betty.
Visit the IRS website and download Schedule 1 of Form 1040. Enter the required values in the appropriate fields. Save your completed Tax Form to your computer and then upload it here by clicking "Browse." Next, click "Save." (Use 2021 tax rules regardless of year on the form.)
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