FISH Company is a regular corporation and is owned by four siblings, Fiona, Ian, Steve, and Herbert. All four are also working for the company as its only employees. They are in the 28% tax bracket; assume a 21% tax rate for the company. The corporation had earnings of $2M before making any payments to the four owners.

Requirements:

A. Assume that the owners receive salary payments of $150,000 each and each also gets a dividend payment of $150,000.

(1) Determine the tax liability for FISH Company:

(2) Determine the tax liability for all four siblings combined:

B. Assume that the owners receive salary payments of $250,000 each and each also gets a dividend payment of $50,000.

(3) Determine the tax liability for FISH Company:

(4) Determine the tax liability for all four siblings combined: