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You are advising a high school basketball coach on whether to organize his summer basketball camps for elementary school children as a C corporation versus

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You are advising a high school basketball coach on whether to organize his summer basketball camps for elementary school children as a C corporation versus an corporation. The coach plans to invest $10,000 in the corporation, operate the camps for 5 years, and then liquidate the corporation. If the business operates as a C corporation, the coach can recover his basis in the corporation shares and pay tax on capital gains at a rate of 15%. The coach's marginal individual income tax rate is 32%. If the business operates as an Scorporation, the coach is eligible for the QB1 deduction because the athletic camp industry is not a QBI-prohibited industry. The expected pre-tax rate of return on the camps is 12% Question 1 25 pts Provide the following inputs to the formulas for the after-tax rate of return to the business. Length of investment horizon Select) Before-tax rate of return Select) Marginal tax rate, adjusted for QBI, if applicable [Select] Individual capital gains tax rate (Select] C corporation tax rate Select

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