Jerry would like to organize FBC as either an LLC or as a corporation (taxed as a C corporation)generating an 8 percent annual before-tax rate of return on a $400,000 investment.Individual and corporate tax rates are both 35 percent and individual capital gains and dividends tax rates are 15 percent.FBC will pay out its after-tax earnings every year to either its members or its shareholders.
a.Ignoring self-employment taxes,how much would Jerry keep after taxes if FBC is organized as either an LLC or as a corporation (taxed as a C corporation)?
b.Ignoring self-employment taxes,what are the overall tax rates (combined owner and entity level)tax rates if FBC is organized as either an LLC or as a corporation (taxed as a C corporation)?

Question

Quizplus · Accepted Answer

The Answer of Jerry would like to organize FBC as either an LLC or as a corporation (taxed as a C corporation)generating an 8 percent annual before-tax rate of return on a $400,000 investment.Individual and corporate tax rates are both 35 percent and individual capital gains and dividends tax rates are 15 percent.FBC will pay out its after-tax earnings every year to either its members or its shareholders.
a.Ignoring self-employment taxes,how much would Jerry keep after taxes if FBC is organized as either an LLC or as a corporation (taxed as a C corporation)?
b.Ignoring self-employment taxes,what are the overall tax rates (combined owner and entity level)tax rates if FBC is organized as either an LLC or as a corporation (taxed as a C corporation)?

Jerry Would Like to Organize FBC as Either an LLC