1. "Corporate Taxation" Please respond to the following:
The YouTube video link below provides a good discussion on corporate taxation in the United States as compared to other nations. Please view the video and identify at least two legislative recommendations you would make to create a more competitive corporate tax system in the United States. Discuss one proposal you would suggest to tax the profits (cash) located in other countries on a current basis.
Obama Corporate Tax Proposal Explained
2. "Unreasonable Compensation" Please respond to the following:
According to Levitt (2013) challenges of unreasonable compensation deductions by the IRS are increasing as a result of the tax rate increases and new taxes under the American Taxpayer Relief Act of 2012 (ATRA). In Mulcahy, Pauritsch, Salvador & Co., Ltd. v. Commissioner, 680 F.3d 867 (7th Cir. 2012), aff’g, T.C. Memo 2011-74 (2011), the IRS challenged deductions taken by an accounting firm, organized as a C corporation, for consulting fees that it paid to entities owned by its founding shareholders, in addition to salaries that it paid directly to them. First explain why you think the courts ruled in favor of the IRS on this case. Next discuss the advice you would provide clients of closely held corporations on avoiding tax issues on unreasonable compensation
IRS “unreasonable compensation” challenges likely to increase
3. "Corporate Liquidations" Please respond to the following:
The following article,” Determining Tax Consequences of Corporate Liquidation to the Shareholders “by Albert B. Ellentuck, Esq. published in The Tax Advisor on September 1, 2012 provides a very good explanation of the impact of liquidations on corporate shareholders. Read the article and discuss at least two potential consequences to shareholders that could result from the liquidation of a closely held corporation.
4. “Transactions between Partners and Partnerships” Please respond to the following:
The following article discusses the risk involved in treating partners as employees. One of the primary risks involved in the article relates to employment tax issues. Review the article “Transactions between Partners and Partnerships” on page 21-39 in the text. From your review discuss at least one reason you feel the IRS has repeatedly opposed the treatment of a partner as a partner and an employee. Provide at least one scenario where a partner can be treated as an employee without any consequences.
Below is the link to the article for the discussion, “Treating partners as employees: Risks to consider.”