A client operates a small business organized as a sole propreintship and is considering change the business to operate as a C corporation. the client wants to know how certain deductable items are treated for tax purposes by a business conducted as a C corporation filling form 1120 ,US corporation income tax Return , as a compared to the way they are treated as a sole proprietorship filling form 1040 US .Individual income Tax Return.
Topic covered in the simulation:
- Charitable contribution limitation.
- Payments to owners for services rendered.
- Payments for health insurance for owners.
- Business meals and entertainment expenses