Jayzee is a single taxpayer who operates a sole proprietorship. He expects his taxable income next year to be $150,000, of which $125,000 is attributed to his sole proprietorship. Jayzee iscontemplating incorporating his sole proprietorship. Using the 2017 single individual tax brackets and the corporate tax brackets, how much current tax could this strategy save Jayzee? (Ignore any Social Security, Medicare, or Self Employment Tax issues.) How much income should be retainedin the corporation? (Use tax rate schedule; Corporate tax rate schedule)

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The Answer of Jayzee is a single taxpayer who operates a sole proprietorship. He expects his taxable income next year to be $150,000, of which $125,000 is attributed to his sole proprietorship. Jayzee iscontemplating incorporating his sole proprietorship. Using the 2017 single individual tax brackets and the corporate tax brackets, how much current tax could this strategy save Jayzee? (Ignore any Social Security, Medicare, or Self Employment Tax issues.) How much income should be retainedin the corporation? (Use tax rate schedule; Corporate tax rate schedule)

Jayzee Is a Single Taxpayer Who Operates a Sole Proprietorship