Refer to the following article: Rubin, Richard; Saunders, Laura, EXCHANGE --- Tax Report: Tax Shelter From the
Question:
Refer to the following article: Rubin, Richard; Saunders, Laura, "EXCHANGE --- Tax Report: Tax Shelter From the Storm --- Blockbuster transaction highlights a capital-gains tax advantage for songwriters," Wall Street Journal, 12 Dec 2020: B.4. Drawing from what you have learned in this course, provide a well labeled and clearly articulated response -- with explanation -- to the following: Explain in your own words, with reference to Internal Revenue Code sections, the Internal Revenue Code authority that would support the following two sentences from this article: "For musicians, a key advantage is that they can sell self-created works and owe capital-gains tax rates of 20% on the sale. That's instead of owing ordinary tax rates of up to 37% each year on the royalty income they get from streaming, licensing, and other uses of their works." Assume that you have been asked about this by a client who doesn't know much about tax law, and who needs to have this explained in the form of a short memo