Question 3
· RogerArmstrong (D.O.B. 1967-01-01) is an insurance broker who has been very successful at his job in the last few years.
· Three years ago, his only child, Victoria, was driving a car that was hit by a distracted driver. She and her husband were killed, and their 13-year-old son, Geoffrey, was blinded by the accident.
· Roger and his wife, Isabella, adopted Geoffrey. Isabella quit her part-time job to care for him.
· Isabella’s parents went through a nasty separation a few years ago and Rita moved in with Roger and Isabella. Isabella’s father’s (Michael) current location is unknown, but it is believed that he is living somewhere in the Baltic.
· Isabelle cares for her mother, Rita, who lives with them. Rita suffers from dementia. The family doctor has signed a letter stating that she is dependent on Roger and Rita because of her impairment. Rita does not meet the residency requirements necessary to qualify for Canadian Old Age Security.
· In addition to his salary, Roger also earns commissions. His employer requires him to have an office in his home and has signed the form T2200 each year to this effect.
· In January 2018, Michael was arrested in Estonia. Isabella had to spend three weeks in Estonia before she could get him released from jail.
· During this time, Roger paid Nannies on Call $5,000 for in-home help to take care of Geoffrey while Isabella was away.
· During the year, Roger’s employer reimbursed $4,000 for meals and entertainment with clients, $3,500 for hotels and $6,000 for airline tickets.
· Roger paid $800 for the care and feeding of Geoffrey’s seeing eye dog.
· During the year, Isabella and Roger made donations of $5,000 and $1,000, respectively, to the Seeing Eye Dog Society.
· During the 2018 taxation year, Roger paid for the following medical expenses for the following individuals:
Name
Procedure
Amount
Roger
Dental
$500
Roger
New Glasses
$1,200
Roger
Prescriptions
$250
Isabella
Dental
$400
Rita
Prescriptions
$800
Geoffrey
Dental
$700
· Finally, Roger has a home office which is used exclusively for to earn income and approximately 1/5th of the house’s square footage is dedicated to the home office. During the 2018 taxation year, Roger incurred the following expenses:
Expense
Amount
Hydro
$3,000
Insurance
$1,200
Maintenance
$4,500
Mortgage Interest
$7,000
Mortgage Life Insurance
$600
Property Taxes
$6,500
Required: Prepare the Roger’s 2018 income tax return using the Profile tax software program.
Name
Isabella Armstrong
Geoffrey Armstrong
Rita Johnson
Michael Johnson
Date of Birth
1966-01-01
2003-02-01
1950-03-01
1950-02-01
Income
$9,500
$0
$600
$500
Roger’s T4 slip from his employer (Insurance Inc.) has the following amounts:
Box 14 $400,000
Box 22 $120,000
Box 16 $2,593.80
Box 42 $95,000
Box 18 $858.22
Box 46 $1,000
