Pear, an individual, plans to start a small business, which will operate as a corporation. In year 0, she expects the corporation to generate an ordinary loss of $550,000. Subsequently, she expects the corporation to be profitable, and projects ordinary profit of $825,000 in year 1, and $1,375,000 in year 2. Pear's personal marginal tax rate on ordinary income is 37 Assuming a corporate tax rate of 21% and a 10% discount rate, calculate the present value of expected tax costs on the business earnings for the first 3 years of operations if the business makes an S corporation election. Assume the excess business loss limitation does not apply. Round your discount rate calculations to three decimal places.

Group of answer choices

$518,925

$494,200

$291,005

$653,400