Chapter 1 Homework - 10 points

1. See the double taxation structure and determine which pay structure is applicable to before / after 2003 regulations. Write in black boxes below.

Partnership

Corporation

Profit

$1,650,000

$1,650,000

Corp tax

$0

$544,500

Net income

$1,650,000

$1,105,500

Cash div

$1,650,000

$1,105,500

Tax div

$0

$221,100

Tax partnership

$594,000

$0

After-tax disposable income

$1,056,000

$1,785,000

Partnership

Corporation

Profit

$1,650,000

$1,650,000

Corp tax

$0

$577,500

Net income

$1,650,000

$1,072,500

Cash div

$1,650,000

$1,072,500

Personal tax

$636,900

$413,985

After-tax disposable income

$1,013,100

$658,515

2. Calculate the five respective taxes and also please indicate whether the taxes are applicable for before / after 2003 regulation: Corporate tax, Dividend tax, Partnership tax, Corporate tax, and Personal tax. Write answers below black boxes above.