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include reference if you use source. and please make your answers original because I need an explanation on where you find your numbers and solutions.
include reference if you use source. and please make your answers original because I need an explanation on where you find your numbers and solutions. Include formulas and steps when you're solving them. thank you.
Question: Mike Barton owns Barton Products, Inc. The corporation has 30 employees. Barton Corporation expects $800,000 of net income before taxes in 2017. Mike is married and files a joint return with his wife, Elaine, who has no earnings of her own. They have one dependent son, Robert, who is 16 years old. Mike and Elaine have no other income and do not itemize. Mike's salary is $200,000 per year (already deducted in computing Barton Corporation's $800,000 net income). Assume that variations in salaries will not affect the U.S. production activities deduction already reflected in taxable income. a. Should Mike increase his salary from Barton by $50,000 to reduce the overall tax burden to himself and Barton Products? Because of the Social Security cap, the corporation and Mike each would incur a 1.45% payroll tax with the corporate portion being deductible. b. Should Barton employ Mike's wife Elaine for $50,000 rather than increase Mike's salary? Take into consideration employment taxes as well as federal income taxes. Note, that Elaine's salary would be well below the Social Security cap, so that she and the corporation each would incur the full amount of payroll taxes with the corporate portion being deductible. Both Elaines and the corporation's portion is 7.65% Question: Mike Barton owns Barton Products, Inc. The corporation has 30 employees. Barton Corporation expects $800,000 of net income before taxes in 2017. Mike is married and files a joint return with his wife, Elaine, who has no earnings of her own. They have one dependent son, Robert, who is 16 years old. Mike and Elaine have no other income and do not itemize. Mike's salary is $200,000 per year (already deducted in computing Barton Corporation's $800,000 net income). Assume that variations in salaries will not affect the U.S. production activities deduction already reflected in taxable income. a. Should Mike increase his salary from Barton by $50,000 to reduce the overall tax burden to himself and Barton Products? Because of the Social Security cap, the corporation and Mike each would incur a 1.45% payroll tax with the corporate portion being deductible. b. Should Barton employ Mike's wife Elaine for $50,000 rather than increase Mike's salary? Take into consideration employment taxes as well as federal income taxes. Note, that Elaine's salary would be well below the Social Security cap, so that she and the corporation each would incur the full amount of payroll taxes with the corporate portion being deductible. Both Elaines and the corporation's portion is 7.65%Step by Step Solution
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