Incorporation is always the best business organization for tax purposes at the federal level.   Federal tax reform has removed some of the tax benefits of incorporation.   Federal tax reform has changed the taxation of businesses, making all types of businesses have similar tax rules.   Shareholders still benefit from delayed taxation because of incorporation.   Tax reform has changed the tax benefits of incorporation.

Q: A sole proprietorship business is planning to incorporate its business to acquire more capital…

A: Incorporation means the legal procedure which is used to form the corporate entity or the company.…

Q: What issue does agency theory examine? Why is it important in a public corporation rather than in a…

A: In agency theory, shareholders give manager the decision making authority over the firm, thus…

Q: What is a tax consequence for a noncorporate shareholder who receives a liquidating distribution…

A: Liquidating distribution is the distribution of the money to the shareholders of the company which…

Q: A corporation cannot start its operation if the Securities and Exchange Commission (SEC) does not…

A: Corporation is a legal form of business organization, under which several members invest their…

Q: For federal income tax purposes, what term refers to the business entity not being a separate entity…

A: A mutual entity is an entity that involves a private company or a public company. The shareholders…

Q: Other than corporations, are there other legal business entities that offer liability protection?…

A: The business can be done through different type of entities. The type of entities will be decided by…

Q: Which of the following will disqualify a corporation from electing Subchapter S status?     All…

A: S corporation is formed for taking Tax advantage.

Q: Pass through. If the corporation is structured as an S corporation, profits and losses are…

A: Meaning of "Passed Through" Status : It is a concept in which the income or loss of an entity is…

Q: From a tax perspective, and disregarding other issues such as limited liability, does it always make…

A: A sole proprietorship is a business owned and controlled only by one person. Because it is a…

Q: In the USA, corporations are subject to double taxations. O True O False

A: Double Taxation: Double taxation is a tax concept that refers to the payment of income taxes on the…

Q: Which circumstance is an example of why Congress established the nonrecognition of gain or loss when…

A: The circumstance that is an example of why congress established the recognition of gain or loss when…

Q: Which of the following is correct? 1 It would be cheaper for ABCL to own and pay for the insurance…

A: The question is multiple choice question Required  Choose the Correct Option.

Q: Which is not a mode of involuntary dissolution of a corporation?  a. Legislative revocation of…

A: Solution: following are mode of involuntary dissolution of a corporation: a. Legislative…

Q: 1. The following are the attributes of a corporation, except * A. It is an artificial being. B. It…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Raising large amounts of capital is more difficult for a partnership than for a corporation. (True…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: Which of the following statements is false concerning forms of businessorganization? a. A…

A: There are four forms of business organization: Sole proprietorship Partnership firm Joint-stock…

Q: What is the reason for renewed interest in not-for-profits corporations?

A: Non-profit corporation  owners do not make a profit. The money of a not-for-profit organisation is…

Q: What would happen to the corporation if it failed to file by-laws? Would it dissolve the corporation

A: Meaning of Corporation: It refers to a legal entity which is distinct from its owners. Corporations…

Q: Which of the following characteristics best describes a corporation?  business with a single owner…

A: Stockholder’s not personally liable for entity’s debts is the correct answer

Q: Which of the following is true of a "Subchapter S Corporation"? O The corporation is subject to…

A: Business organization is formed to carry out the commercial activities. Some examples of business…

Q: Which of the following is true?  Non-profit corporations are exempt from corporate income tax.…

A: MCIT stands for Minimum Corporate Income Tax which is imposed on domestic corporates.It is applied…

Q: Why do you think a single WACC is not applicable to all businesses in a corporation?

A: The W.A.C.C. or weighted average cost of capital determines the required rate of return of common…

Q: Why would a company have a physical headquarters in one state but file for incorporation in another…

A: Explanation : A Corporation can be incorporated in only one state and it can handle business in all…

Q: Can a sole proprietor form as a single-member limited liability company (LLC)? If so, how would such…

A: Internal Revenue Service has classified the businesses as : Sole proprietorship S corporation C…

Q: Which of the following statements with respect to the taxation of capital gains is not correct?…

A: The base of the similar property is calculated by dividing the total capital gains by the units of…

Q: What would be the advantages of having companies formed at the federal level? Do you think these…

A: The confusion with the rising business is to weather go with the federal level registration or state…

Q: Select the best term for each definition below.

A: Shareholders’ equity:   Shareholders’ equity refers to the right the owner possesses over the…

Q: You are the lead S-Corporations tax specialist in your area. Your client, Cathyrn, has purchased an…

A: It refers to a type of a corporation which complies with certain requirements of the Internal…

Q: Why would a corporation purchase the stock of another corporation?     a. To prevent double…

A: As this is Multiple Choice Question Usually Corporation Purchases the Stock of any other corporation…

Q: The first step in forming a sole proprietorship is filing out the appropriate paperwork and paying…

A: Note: As per the Policy, we’ll answer the first question since the exact one wasn’t specified.…

Q: ements for tax exemption C. Type of for-profit business that also has a social mission D. Type of…

A: The definition of S corporation as,

Q: What issue does agency theory examine? Why is it important in a public corporation rather than in a…

A: Agency theory states the fiduciary duty of management towards the shareholders. The duty is to…

Q: Which of the following statements is CORRECT?    One drawback of forming a corporation is that it…

A: The corporation is a category of business that is formed by the law of the country and is considered…

Q: Which of the following describes when a corporation pays income tax on its profits, and when the…

A: Double Taxation: It is a term used to portray the technique through which taxes are forced on…