Lorelei files HOH and owns an inn called The Dragon Fly. Currently The Dragon Fly is a single member LLC and all income is reported on her personal income tax return. During 2016, the net profit from The Dragon Fly was $175,500. Lorelei has additional taxable income of $115,000. She is considering incorporating The Dragon Fly. Please calculate the following:

What is Loreleis 2016 income tax liability if The Dragon Fly remains a Single Member LLC?

What is Loreleis minimum 2016 income tax liability (both individual & corporate) if she incorporates The Dragon Fly, assuming she is able to pay herself the desired salary?

What should she do? Explain.