Tom Johnson is married with two children. His family consists of his wife Hillary Johnson and his children Bob Johnson and Liz Johnson. This case study is mainly surrounding Tom's earnings, but Hillary also works and receives a salary of $80,000 which SHOULD be included in the overall taxable income calculation and included on Form 1040. Bob Johnson is 12 years old and lives at home. His parents fully provide for him. Liz Johnson is a 23 year old full time student and lives at school. She has a part time job and earns $4000 a year. Her parents provide for more than 50% of her support. For this project please use the 2017 tax forms and tax rates. Please also use the 2017 IRC 179 expense rules and 2017 bonus depreciation and MACRS depreciation rules.

Corporation See below for Sales, expense and transaction information during the year Tom is an employee at Corporation X and get a salary at $50,000 Assume all taxable income at the end of the year is paid out as a dividend. Assume Tom owns 5% of the compan Ignore the Domestic Production Activities Deduction (DPAD) income and deduction items Sales COGS salaries 3,000,000 100,000 300,000 transactions 1/1/2017 Machinery-new 1/1/2017 equipment new 1/1/2017 Machinery -sold Cost-1,000,000 Cost 1,200,000 Cost $500,000 Cumulative Depreciation 300,000 Sale Proceeds $250,000 Cost $600,000 Cumulative Depreciation 300,000 Sale Proceeds $200,000 Cost $750,000 Cumulative Depreciation 400,000 Sale Proceeds $1,000,000 1/1/2017 equipment sold 1/1/2017 Building - sold Requirements 1 Complete Pages 1,3, and supporting Schedules for 2017 Form 1120 2 Calculate the Taxabe Income of the corporation and the dividend to be paid