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The company would like to make a property distribution (dividend) of
the three machines that it uses in its business. It no longer needs two
of these machines.
All three machines have a fair market value of $20,000 each. The
basis of each machine is as follows: Machine A, $27,000; Machine B,
$20,000; and Machine C,
$12,000. The corporation has asked you for advice. What do you
recommend?
Your final portfolio artifact is the comprehensive, professional tax
memo and appendix that you develop for Ms. Emma Shire, another
client at S.N.H.U., LLC. As
you did with the previous two artifacts, make sure to incorporate the
feedback that you receive from your instructor and peers.
Memo: You will justify recommendations and explain potential issues
and future decisions relating to Ms. Shire’s tax situations. Given that
Ms. Shire is not well
versed in accounting, make sure that your memo addresses her
concerns in language that she can understand.
Address Ms. Shire’s questions pertaining to personal tax planning.
Based on her given information, what actions can Ms. Shire take
throughout the year
to effectively reduce her tax liability? Provide specific
recommendations, defend them with tax regulations, and explain the
tax consequences or savings
in conceptual and dollar value terms.
Address Ms. Shire’s questions pertaining to her partnership income.
Based on the given information, what actions can Ms. Shire take
throughout the