Wilma is CEO of and owns 100 percent of WT Enterprises, a cash-basis, calendar-year corporation. The company has always been profitable but over the last five years Wilmas salary has increased from over $400,000 per year to over $1,000,000 and it has failed to pay dividends. Which of the following will not occur if the IRS determines that $500,000 of her salary is unreasonable? a. Wilma will pay an additional tax on the $500,000 recharacterized as dividend. b. Wilma will be eligible for a refund of Medicare taxes. c. WT will lose a $500,000 deduction for the recharacterized dividend. d. WT will be eligible for a refund of a portion of FICA taxes paid. 11. James owns a sole proprietorship. James pays his son Albert, age 17, $8,000 and his daughter Chloe, age 19, $11,000 for their work in the business. Both wages are reasonable for the work they perform. How much FICA tax must the sole proprietorship pay on the wages? a. 0 b. $612 c. $842 d. $1,454