Jacquiline is unmarried and age 32. Even though she participates in an employer-sponsored retirement plan, Jacquiline contributed $3,120 to a traditional IRA during the year. Jacquiline files as a head of household, her AGI before the contribution is $43,600, and her marginal tax rate is 15 percent. Exhibit 13-9 What is the after-tax cost of her $3,120 traditional IRA contribution?

after tax cost.

Required information

[The following information applies to the questions displayed below.] Andrea would like to organize SHO as either an LLC or as a C corporation generating an 4 percent annual before-tax return on a $320,000 investment. Assume individual and corporate tax rates are both 35 percent and individual capital gains and dividend tax rates are 15 percent. SHO will pay out its after-tax earnings every year as a dividend if it is formed as a C corporation. Assume Andrea is the sole owner of the entity. Ignore self-employment taxes, the additional Medicare tax, and the net investment income tax.

a. How much would Andrea keep after taxes if SHO is organized as either an LLC or as a C corporation?

LLC

C corporation