Questions from Taxation

Q: Why is only half of a sole proprietor’s self-employment tax

Why is only half of a sole proprietor’s self-employment tax deductible in the computation of taxable income?

Q: To what extent does the corporate characteristic of limited liability protect shareholders

To what extent does the corporate characteristic of limited liability protect shareholders employees who perform professional services for corporate clients?

Q: In your own words, explain the conclusion that corporations do not

In your own words, explain the conclusion that corporations do not pay tax—people do.

Q: Mr. and Mrs. Dane and their six children own 100

Mr. and Mrs. Dane and their six children own 100 percent of the stock in three family corporations. Do these corporations qualify as an affiliated group eligible to file a consolidated corporate tax r...

Q: RP Inc. owns 59 percent of QV’s voting stock. RP’s

RP Inc. owns 59 percent of QV’s voting stock. RP’s board of directors elects the majority of the members of QV’s board of directors and thereby controls QV’s management. Are RP and QV an affiliated gr...

Q: Libretto Corporation owns a national chain of retail music stores. The

Libretto Corporation owns a national chain of retail music stores. The corporation wants to expand into a new, extremely competitive, and highly specialized business—the composition and production of...

Q: AP constructed a new manufacturing plant for a total cost of $

AP constructed a new manufacturing plant for a total cost of $9,465,000 and placed it in service on March 2. To finance the construction, AP took out a $6 million, 30-year mortgage on the property. Co...

Q: Corporations are required to detail their book/tax differences on either

Corporations are required to detail their book/tax differences on either Schedule M-1 or Schedule M-3 attached to the corporate income tax return. Why is the IRS interested in this information?

Q: In your own words, explain why a tax credit is more

In your own words, explain why a tax credit is more valuable than a tax deduction of the same dollar amount.

Q: Why is real property a better tax base than personal property?

Why is real property a better tax base than personal property?