Ac553 Week 4 Paper

AC553: Federal Taxes and Management Decision Jan12 Sec. B Week 4: You Decide Assignment January 25, 2012 MEMORANDUM To: Mr. rump smith and Mrs. Jane Smith From: Date: January 26, 2012 RE: 2011 Tax Strategy Dear jest and Jane, Thank you for the opportunity to work on your behalf for tax readiness this form again. Per our last appointment, I have prep deal this memorandum as a preliminary work on this years tax strategy. The three main sections argon constructed harmonise to inquiries made by each of you individually and, then, to reason on the options available for you both and my recommendation. revel note that I use up that you wouldnt be planning to tack the tax history method from cash method as I claver no reason to. 1(a): $300,000 income is treated as a ingredient of gross income from operation for tush this year. Please let me remind you that tax implication of an LLC is quite various from corporations. By default, LLCs are t reated as pass-through entity which means that your hard is disregarded in tax purpose and all shekels and loss impart be passed down to the LLC owners (CCH, p14-4, IRS, p3) .

In this case, it is you ( take for granted that fundament Smiths firm is a iodin-owner LLC) who impart be reporting the firms profit and loss on Schedule C on your individual tax proceeds. (Again, assuming this this is a single-owner LLC. If not, it will be treated as a partnership and John Smith would be receiving K-1, reporting the processs divided share of profit and loss.) Alternatively, LLC can elect(ip) to be taxed as a corporation (either as C corporate, a signalize tax paying entity, or S corporati on, a conduit entity) by filling out Form 88! 32 (IRS). This substitute(a) scenario is due to pas seul in state laws as to whether a single soul LLC can report on a business concern return or not. 1(b): The additional $25,000 received as a reimbursement for the salt away expenses for this case results in no taxable income as taxation minus accumulated...If you want to get a full essay, auberge it on our website: OrderEssay.net

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