Summitt Corporation has manufactured and distributed basketball equipment for 20 years. Its owners would like to avoid the corporate income tax and are considering becoming a limited liability company (LLC). What tax savings may result from electing to be treated as an LLC? What federal tax costs will be incurred to make the change from a C corporation to an LLC? Would the same transaction costs be incurred if instead the corporation made an S election? Would the transaction costs be incurred had LLC status been adopted when the entity was initially organized? What tax savings may result from electing to be treated as an LLC? (If an input field is not used in the table, leave it empty; do not select a tax saving.) Tax Savings Avoid shareholder-level tax on C corporation distributions, and passing losses through its shareholders Avoid corporate income tax Claiming the 20% qualified business income deduction Offsetting capital gains with capital losses