P1-2. Calculate the tax disadvantage to organizing a U.S. business as a corporation versus a partnership under the following conditions. Assume that all earnings will be paid out as cash dividends. Operating income (operating profit before taxes) will be $3,000,000 per year under either organizational form; the effective corporate profits tax rate is 30 percent (T = 0.30); the average personal tax rate for the partners of the business is 35 percent (T) = 0.35); and the capital gains tax rate on dividend income is 15 percent (T. = 0.15). Then, recalculate the tax disadvantage using the same income but with the maximum tax rates that existed before 2003. These rates were 35 percent (T = 0.35) on corporate profits and 38.6 percent (T) = 0.386) on personal investment income. cg