chedule Y$-1-$Married Filing Jointly or Qualifying surviving spouse

Orie and Jane, husband and

wife, operate a sole

proprietorship. They expect their

taxable income next year to be

$$450,000,$ of which $$250,000$ is

attributed to the sole

proprietorship. Orie and Jane are

contemplating incorporating their

sole proprietorship. $($Use the tax

rate schedule $($

Required:

a Using the married$-$joint tax

brackets and the corporate tax

rate, find out how much current

tax this strategy could save Orie

and Jane.

b After considering your

answer to part

A$,$ if they proceed with the new

strategy, how much income

should be shifted to the

corporation?