AC 553 You Decide Week 4 BEM Tax Services Memo

AC 553 You Decide Week 4 BEM Tax Services Memo To John and Jane

AC553 You Decide Week 4

BEM Tax Services

Memo

To: John and Jane Smith

From: Benedict Mitchell

Date: [ 10/7/2011 ]

Re: Tax Issues

Upon reviewing the information you submitted to me concerning your taxes, they were several issues which I observed.

First I will like to discuss John’s issues:

* The $300,000 will have to be treated as ordinary employment income, subject to federal and state income taxes.

* The $25,000 will have to be treated as an expense.

* I have determined that you have to account for all qualified business expenses and only net income will be taxable.

AC 553 You Decide Week 4 BEM Tax Services Memo