Blue Eyed Beauty Supply is the talk of the town. When Elaine started her business, she had no idea it would evolve to be the number one supplier of cosmetology supply in the region. While her business has been successfully operating as a sole proprietorship for many years, her legal counsel has urged her to form a separate legal entity for a variety of nontax reasons. Elaine will form an LLC but has come to you for advice as to which tax classification is best positioned to pay the least overall tax. She has provided you with her 2022 tax data and the following assumptions to develop an Excel model: Elaine is Single and her sole source of income is from her business activities It is expected that her business meets the definition of a trade or business for Qualified Business Income deduction purposes The business generates $140,000 of net income before contemplating any taxes Elaine is assuming a reasonable compensation amount of $50,000 As a C Corporation, the business will dividend out all earnings after taxes are paid to Elaine
Required:
1. Complete the "The tax is:" column for the filing status table using a formula.
2. Complete the Schedule C tax calculations using VLOOKUP formulas to the 2022 tax brackets.
3. Complete the S Corporation tax calculations using VLOOKUP formulas to the 2022 tax brackets.
4. Complete the C Corporation tax calculations using VLOOKUP formulas to the 2022 tax brackets.
(HINT: Use the TRUE logical value for VLOOKUP formulas)
Schedule X - Single
If taxable income is over:	But not over:	The tax is:
$-	$10,275.00	$-
$10,275.00	$41,775.00
$41,775.00	$89,075.00
$89,075.00	$170,050.00
$170,050.00	$215,950.00
$215,950.00	$539,900.00
$539,900.00	$-
Schedule C
Schedule C Income	$140,000.00
Self-Employment Tax
Less: 50% Self-Employment Tax
AGI
Less: Standard Deduction	$12,950.00
Less: QBI
Taxable Income:
If taxable income is over:
But not over:
The tax is:
Plus tax percentage:
Plus tax amount:
Ordinary Personal Income Tax
Overall Total Tax
Overall Tax Rate
S Corporation
W-2 Income	$50,000.00
Less: Employee Share of Payroll Taxes
Net W-2 Compensation
S Corporation Income Before Payroll Tax	$90,000.00
Less: S Corporation Payroll Tax	$3,825.00
Other Income - S Corp K-1	$86,175.00
AGI
Less: Standard Deduction	$12,950.00
Less: QBI
Taxable Income:
If taxable income is over:
But not over:
The tax is:
Plus tax percentage:
Plus tax amount:
Ordinary Personal Income Tax
Overall Total Tax
Overall Tax Rate
C Corporation
W-2 Income	$50,000.00
Less: Employee Share of Payroll Taxes
Net W-2 Compensation
C Corporation Income Before Payroll Tax	$90,000.00
Less: C Corporation Payroll Tax
C Corporation Taxable Income
C Corporation Income Tax
AGI
Less: Standard Deduction	$12,950.00
Taxable Income
If taxable income is over:
But not over:
The tax is:
Plus tax percentage:
Plus tax amount:
Ordinary Personal Income Tax
Dividend From C Corporation
Qualified Dividends Tax
Total Personal Tax
Overall Total Tax
Overall Tax Rate

al Tax Overall Total Tax Overall Tax Rate