Start by completing the total federal income tax cost if Modems for All operates as part of Industrial Kitchens. Under this option, the operations will be combined and the organization will continue to operate as an S corporation. Information about the taxable income and deductions for the operations is included in the spreadsheet (attached at the end of this file). To complete this analysis, you will need to determine the income of the S corporation under the following two options: - Calculate the ordinary income of the S corporation if the company decides to depreciate the equipment without using any provisions that will accelerate the cost recovery (for example, bonus depreciation and/or Sec. 179). - Calculate the ordinary income of the S corporation if the company decides to use Sec. 179 and/or bonus depreciation. Once you've calculated the ordinary income of the S corporation, you will then need to: - Calculate the impact on the tax liability of the shareholders. This step will include the calculation of the qualified business income deduction for the shareholders.

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To determine the total federal income tax cost for Modems for All operating as part of Industrial Kitchens you will need to calculate the ordinary inc... View the full answer