Polly owns CopyEdit, a sole proprietorship. The net income from CopyEdit is consistently around $200,000. Polly is
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Polly owns CopyEdit, a sole proprietorship. The net income from CopyEdit is consistently around $200,000. Polly is considering making Kevin, one of her employees, an owner of the business. He would continue to be paid his $40,000 salary and own a 25% interest in the business. Polly would receive a salary of $100,000 from the new entity. She has asked you to determine the total income tax liability for each of the entities listed below. Assume that both Polly and Kevin have income from other sources that offset their allowable deductions, and that they are both single.
a. Partnership
b. Corporation
c. S corporation
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Related Book For
Concepts In Federal Taxation
ISBN: 9780324379556
19th Edition
Authors: Kevin E. Murphy, Mark Higgins, Tonya K. Flesher
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