Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Fallon is a 100% owner of Fallon, Inc., a C Corporation. In the current year, Fallon, Inc., reports $150,000 of taxable income (all ordinary income)

Fallon is a 100% owner of Fallon, Inc., a C Corporation. In the current year, Fallon, Inc., reports $150,000 of taxable income (all ordinary income) and distributes its after-tax income to Fallon. Assume Fallons marginal rate on ordinary income is 35% and her marginal rate on qualified dividends is 15%. Calculate the combined corporate and individual tax paid by Fallon and Fallon, Inc.

a. $31,500.

b. $49,275.

c. $54,000.

d. $52,500.

  1. Cary owns 100% of Salt, an S corporation. Salt had net taxable income of $80,000 and made a $15,000 distribution to Cary. Assume Carys basis in Salt is $40,000 before considering these above transactions. What is Carys basis in Salt after the above transactions?

    a. $95,000.

    b. $120,000.

    c. $105,000.

    d. $55,000.

    e. None of the above.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Energy Audit And Management Concept Methodologies Procedures And Case Studies

Authors: L. Ashok Kumar, Gokul Ganesan

1st Edition

978-1032067797

More Books

Students also viewed these Accounting questions

Question

=+multiplicity 1). If A + 1, then |A| Answered: 1 week ago

Answered: 1 week ago