Mr. U accepted an engagement to perform consulting services for MK Company. The engagement will last at least 18 months. Identify any reasons why Mr. U might prefer to be classified as an MK employee rather than as an independent contractor.
Answer to relevant QuestionsDiscuss the practical reasons why the tax law authorizes the IRS to collect un-withheld employee payroll tax from the employer rather than the employees who were liable for the tax. Greg Company agreed to pay Ms. Bilko $45,000 compensation for services performed for the company. a. Compare the income tax consequences to Greg and Ms. Bilko if she is an employee or if she is an independent contractor. b. ...Mr. T (a 45-year-old single taxpayer) exercised an ISO and purchased $380,000 worth of his employer’s stock for only $113,000. His only other income was his $158,500 salary, and he doesn’t itemize deductions. Compute Mr. ...MN’s compensation package for its CEO consisted of a $600,000 salary plus $200,000 unfunded deferred compensation. The CEO will receive the $200,000 when he re-tires in 2020. He is also a participant in MN’s qualified ...Mrs. Kwan withdrew the entire $8,000 balance from her Roth IRA this year. Her total contributions to the account were $6,070, and her marginal tax rate is 15 percent. Determine the tax cost of the withdrawal if: a. Mrs. Kwan ...
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