Jonathan owns 100% of Lemon Company (a calendar year entity). In the current year, Lemon recognizes a long-term capital gain of $70,000 and no other income (or loss). Jonathan is in the 37% tax bracket (and 20% tax bracket for any net capital gains or dividends) and has no recognized capital gains (or losses) before considering his ownership interest in Lemon Company. What is the income tax result from the $70,000 if Lemon is (a) an LLC and (b) a C corporation? Question Content Area a. If Lemon is an LLC: Assuming no election has been filed under the Check-the-box Regulations, the tax on the $70,000 long-term capital gain is $fill in the blank 622729fd8f91fc1_1 70,000 . Feedback Area Feedback Question Content Area b. If Lemon is a C corporation: The tax on the $70,000 long-term capital gain is $fill in the blank 57a3df008051001_1 14,000 . Feedback Area Feedback
Jonathan owns 100% of Lemon Company (a calendar year entity). In the current year, Lemon recognizes a long-term capital gain of $70,000 and no other income (or loss). Jonathan is in the 37% tax bracket (and 20% tax bracket for any net capital gains or dividends) and has no recognized capital gains (or losses) before considering his ownership interest in Lemon Company. What is the income tax result from the $70,000 if Lemon is (a) an LLC and (b) a C corporation? Question Content Area a. If Lemon is an LLC: Assuming no election has been filed under the Check-the-box Regulations, the tax on the $70,000 long-term capital gain is $fill in the blank 622729fd8f91fc1_1 70,000 . Feedback Area Feedback Question Content Area b. If Lemon is a C corporation: The tax on the $70,000 long-term capital gain is $fill in the blank 57a3df008051001_1 14,000 . Feedback Area Feedback
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Jonathan owns 100% of Lemon Company (a calendar year entity). In the current year, Lemon recognizes a long-term capital gain of $70,000 and no other income (or loss). Jonathan is in the 37% tax bracket (and 20% tax bracket for any net capital gains or dividends) and has no recognized capital gains (or losses) before considering his ownership interest in Lemon Company.
What is the income tax result from the $70,000 if Lemon is (a) an LLC and (b) a C corporation?
Question Content Area
a. If Lemon is an LLC:
Assuming no election has been filed under the Check-the-box Regulations, the tax on the $70,000 long-term capital gain is $fill in the blank 622729fd8f91fc1_1
70,000
.
Feedback Area
Feedback
Question Content Area
b. If Lemon is a C corporation:
The tax on the $70,000 long-term capital gain is $fill in the blank 57a3df008051001_1
14,000
.
Feedback Area
Feedback
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