The Bruin Corporation, a C corporation, is owned 100% by John Bean and had taxable income in
Question:
The Bruin Corporation, a C corporation, is owned 100% by John Bean and had taxable income in 2017 of $500,000. John is also an employee of the corporation. In December 2017, the corporation has decided to distribute $400,000 to John and has asked you whether it would be better to distribute the money as a dividend or salary. John is in the 39.6% marginal tax bracket. How would you respond to Bruin Corporation? Consider only income taxes for this problem.
CorporationA Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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To properly respond to Bruin tax calculations for both Bruin Corporation and John Bean must be made ...View the full answer
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Related Book For 
Federal Taxation 2018 Comprehensive
ISBN: 9780134532387
31st Edition
Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson
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