Answered: identify the tax issue(s) posed by the…

identify the tax issue(s) posed by the facts presented. Determine the possible tax consequences of each issue that you identify

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter13: Choice Of Business Entity—general Tax And Nontax Factors/formation

Section: Chapter Questions

Problem 11DQ

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Question

Raquel is an employee of Jones Company and owns a 30 percent interest in
the company. Her salary is $44,000. She also receives a $10,000 cash
distribution from Jones. During the current year, Jones’s operating income is
$130,000.

identify the tax issue(s) posed by the facts presented.
Determine the possible tax consequences of each issue that you identify.

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