Question

Identify the tax issue or issues suggested by the following situations and state each issue in the form of a question.
In October 2013, Firm G completed a consulting engagement and received a $200,000 cash payment for its services. In December, the client notified Firm G that it was un-satisfied with the work and demanded that Firm G refund $50,000 of the payment. Firm G refused and referred the matter to its attorney. In 2015, Firm G settled the dispute by paying the client $30,000. Firm G’s 2013 marginal tax rate was 39 percent and its 2015 marginal tax rate was 34 percent.


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  • CreatedNovember 03, 2015
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