Part 2 Common Facts for Each Situation: Epic Feat Inc. (Epic), a U.S. corporation, took its first step toward global domination during 2020 by establishing a global enterprise that acquires goods from a manufacturer in Guatemala and resells those goods to retail customers in Thailand (the Business'). Legal title to the goods passes to the customers in Thailand, and the Business will generate $137,000 of income (gross income less deductible expenses, as determined under U.S. tax laws) as it gets a toehold in the Thai market during 2020. Epic will also have $310,000 of U.S. source income (gross income less deductible expenses, as determined under U.S. tax laws) from its business operations wholly within the United States. The total value of Epic's tangible assets is $2,682,000 (i.e., the original cost of the assets less ADS straight-line depreciation). Assume the U.S. government taxes Epic at a 21% flat rate. Required (25 points for each INDPENDENT situation): (A) Assume Epic conducts the Business without having any of its assets or employees outside the United States (i.e., all $2,682,000 of the tangible assets are located within the United States), and the Thai government will impose $13,700 of withholding taxes on Epic's sales to Thai customers during 2020. Explain what amount of income tax Epic will owe the US government for 2020. (B) Assume Epic moved $670,500 of its tangible assets to Thailand and conducts the Business as a branch. Assume further that--under Thai tax law--the Thai government will treat Epic's branch as having taxable income of $232,900 for 2020, and the Thai government imposes a 6% tax rate on taxable income up to $100,000 and a 8% tax rate on taxable income in excess of $100,000. Explain what amount of income tax Epic will owe the U.S government for 2020. (C) Assume Epic transferred $670,500 of its tangible assets to a newly-formed Thai corporation (a 'foreign subsidiary') in exchange for all of the foreign subsidiary's stock, and the foreign subsidiary conducts the Business. Assume further that--under Thai tax law--the Thai government will treat the foreign subsidiary as having taxable income of $232,900 for 2020, and the Thai government imposes a 6% tax rate on taxable income up to $100,000 and a 8% tax rate on taxable income in excess of $100,000. Finally, assume the foreign subsidiary will not make any distributions to Epic during 2020. Explain what amount of income tax Epic will owe the U.S government for 2020. Part 2 Common Facts for Each Situation: Epic Feat Inc. (Epic), a U.S. corporation, took its first step toward global domination during 2020 by establishing a global enterprise that acquires goods from a manufacturer in Guatemala and resells those goods to retail customers in Thailand (the Business'). Legal title to the goods passes to the customers in Thailand, and the Business will generate $137,000 of income (gross income less deductible expenses, as determined under U.S. tax laws) as it gets a toehold in the Thai market during 2020. Epic will also have $310,000 of U.S. source income (gross income less deductible expenses, as determined under U.S. tax laws) from its business operations wholly within the United States. The total value of Epic's tangible assets is $2,682,000 (i.e., the original cost of the assets less ADS straight-line depreciation). Assume the U.S. government taxes Epic at a 21% flat rate. Required (25 points for each INDPENDENT situation): (A) Assume Epic conducts the Business without having any of its assets or employees outside the United States (i.e., all $2,682,000 of the tangible assets are located within the United States), and the Thai government will impose $13,700 of withholding taxes on Epic's sales to Thai customers during 2020. Explain what amount of income tax Epic will owe the US government for 2020. (B) Assume Epic moved $670,500 of its tangible assets to Thailand and conducts the Business as a branch. Assume further that--under Thai tax law--the Thai government will treat Epic's branch as having taxable income of $232,900 for 2020, and the Thai government imposes a 6% tax rate on taxable income up to $100,000 and a 8% tax rate on taxable income in excess of $100,000. Explain what amount of income tax Epic will owe the U.S government for 2020. (C) Assume Epic transferred $670,500 of its tangible assets to a newly-formed Thai corporation (a 'foreign subsidiary') in exchange for all of the foreign subsidiary's stock, and the foreign subsidiary conducts the Business. Assume further that--under Thai tax law--the Thai government will treat the foreign subsidiary as having taxable income of $232,900 for 2020, and the Thai government imposes a 6% tax rate on taxable income up to $100,000 and a 8% tax rate on taxable income in excess of $100,000. Finally, assume the foreign subsidiary will not make any distributions to Epic during 2020. Explain what amount of income tax Epic will owe the U.S government for 2020