Essays on Tax Liability

Court allows Wife to consider inherited farm inputs as part of the expenditure of carrying out farming business even when the deceased husband had deducted the same expenditure. The court held that the petitioner could deduct the cost of all the farm inputs from the 2011 farm income. This is despite the husband tax returns indicating the same cost were deducted in calculating the tax payable in 2010. Thus, the court held that commissioner of internal revenue was wrong to disallow the petitioner from deducting the expense.

Facts

Steve Backemeyer used to carry out farming business while his wife Julie ...

Income Tax Accounting

Income Tax Accounting

According to IAS 12, deferred tax asset is used to describe an asset that will minimize the amount of tax that a firm wishes to pay in a future accounting period. In the future, it can be used as a write off element when the next tax period is projected to produce increased earnings. The IAS 12 offers that the difference in tax bases for an asset and deductible temporary difference is what creates a deferred tax asset. It implies that the future cash flows are significant. The taxes are usually plowed back into the business ...

Tax File Memorandum

Mary Robinson licensed surveyor of Silver Corporation Relevant Facts Silver Corporation, a calendar year C corporation, is solely owned by Mary Robinson. Silver Corporation is a surveying company that has been in business since its incorporation in 2012. Mary, the only employee, is a licensed surveyor. However, she is not a licensed engineer. Silver Corporation meets the requirements for a Personal Service Corporation. Silver Corporation’s 2012 and 2013 tax returns were audited by the IRS. The IRS assessed tax deficiencies stemming from its conclusion that the corporation was a personal service corporation that is subjected to the flat ...

Question 1

Within an organisation, accounting plays an active role to ensure that all business transactions of monetary value are classified, recorded, measured, summarised and reported in an accurate manner by adhering strictly to basic reporting rules such as International Financial Reporting Standards (IFRS) or US GAAP. Accounting rules make sure that financial statements are prepared and reported accurately by complying strictly with all reporting principles. Additionally, accounting steps confirm that all financial information is included in reporting mechanism while financial statements contain no error or any material misstatement having huge financial consequences. When the industry follows one accounting mechanism, it ...

The U.S tax system can be classified as progressive where tax rates increase with increases with taxable base or the gross income (Amico 2003, pp 14). The Internal Revenue Service (IRS) under the Federal Government defines gross income as any income from whatever source except for the items excluded by the state. Sources of income in this case include compensations such as service, income from insurance (except death benefits), interests, pensions, and annuities, gross profits from businesses, income from corporations, partnerships, trusts and estates, amongst others (Lymer 2004, pp 144). The state excludes death benefits accruing from life insurances, ...

STARBUCKS REPUTATION

In the pursuit of their objectives organizations become so uncompromising that they only realize the importance of goodwill once it is lost. The same is the case with Starbucks. First, it took advantage of the loopholes in the accounting standards and taxation laws to minimize corporate tax liability and when caught doing so they actually admitted it by announcing that they would pay more corporation tax in 2013-2014, regardless of whether the company is profitable or not. (Armistead, 2012)

The company has not been successful in managing its reputation after the tax avoidance scandal. In fact, it is among ...

Introduction

With the emergence of a global competition, every business faces a challenge to capture more market share by improving the bottom line of its financial statements and reinvesting much of the earnings to expand operations. For this organizations implement tight internal controls so that none of the business transaction goes unchecked. In this regard, an auditor’s role is critical to track any possibility of fraudulent activity within the business finance. With such a concept in mind, this paper has been written to identify the roles and responsibilities which an internal auditor assumes within an organization. The major focus of this ...

a) A control group is created when two or more people jointly acquire more than 50% stock of one company. Just like Tammy and Matthew in the second case. b) Matthew, Kelly and Tammy will acts as a control group with having share of 33% or one-third of the stock. In this case, the taxable income will be computed by the following formula. Since, all three are partner and they share equal liabilities and as a result they will equal tax liability of 33%. Matthew, Kelly and Tammy have a taxable income of = (325 + 400)/3 = 725,000/3 = $241,667 ...

Part One:

a) Calculate the Weighted Average Cost of Capital WACC: Weight of Debt* Cost of Debt(1-Tax rate) + Weight of Equity* Cost of Equity WACC:[( 200000/400000)* 0.09(1-.22)] + [(200000/400000)* .15] WACC: 0.0351+ .0300

WACC: 6.51%

*WACC that is also known as Cost of Capital will be used further to discount the cash flows of the company. b)Calculation of Capital Allowance and Tax Payable on each project:

Project A:

Tax depreciation Capital Allowance and tax liability *Assuming that business loss for Year 1 will not be carry-forward to be offset from Year 2 profit and also there is no minimum ...

Analysis of Financial Statements of Goldman Sachs

Introduction A world renowned company, Goldman Sachs is an American Multinational Corporation that deals with the institutional clients offering investment banking, investment management and other related financial services. The following report will analyze some of the crucial items of the financial statements of Goldman Sachs including Earning per Share, Cash Flow Statement, Tax Deferrals, Share based compensation, Employee Compensation Plans. We are sure that by the end of this report, we will be able to have a comprehensive overview of the company’s financial statements.

Amount Disclosed Footnote Information-Deferred Taxes Note 24 of the Annual Report is ...

In order to compare the taxation practices of Egyptian and non-Egyptian firms, we will be analyzing the following list of the companies, all of which are from the telecommunication industry. Below is the list of Egyptian and Non-Egyptian firms, which we analyze for the purpose of comparing their tax reporting practices:

Egyptian Firms:

- Telecom Egypt - Mobinil - Etisalat

Non-Egyptian Firms:

- AT& T - MCI - Sprint

Egyptian Firms

I) Mobinil: Founded in the year, 1988, Mobinil is one of the largest telecom companies in Egypt. As for the tax reporting by the company, during 2012, the company ...

Course:

Introduction Governments in the world today loose much revenue through tax evasion and tax avoidance practise by individuals and business enterprises (Innes 2005). The paper shall discuss the difference between tax evasion and tax avoidance using recent relevant examples and give their implications. The paper shall also evaluate the how the taxation policies result to distribution of income in UK and the failure involved. The paper shall also examine the influence of international laws and EU policies on UK taxation policies.

Differences between tax avoidance and tax evasion

The term tax evasion refers to use of illegal mean to avoid paying taxes. Tax evasion comprises ...

Globalization has led to firms becoming multinationals since additional international markets are opening up and, therefore, economies are becoming integrated. With the increase in trade, migration and finance there are expected to be a rise in the level of global domestic Product. The Organization for Economic Co-operation and Development (OECD) was established to stimulate trade between countries and also ensure that there is economic progress. OECD has thirty-four member states currently including the U.S, France, and U.K among others (OECD, 2005). These are some of the best economies in the world hence OECD hence this business plays a major role in ...

Article summary

The SEC is investigating Barnes and Noble’s accounting. This is based on the company’s decision to restate its earnings for both 2011 and 2012 fiscal years. In 2011, there was a loss restatement from $ 68.8 million to $ 73.9 million. In 2012, there was a loss restatement from $ 64.8 million to $ 68.9 million (Trachtenberg, 2013). This matter has led to a decline in stock price of the company by 12% to $ 14.43. Earnings restatement was based on an overstatement of accruals for the two years. A deferred tax liability is another correction that Barnes and Noble wish to change. The current ...

Liability is one of the most important words in the field of law. It essentially means legal responsibility for one’s actions or the omissions thereof. By failing to meet these responsibilities, a person or entity exposes himself/herself/itself to a lawsuit for whatever damage that may result from such failure; or risks being served with a court order to meet such responsibilities. Liability is one of the legal aspect that everyone should not only be interested in but also ensure that they are well versed in it to avoid finding themselves on the wrong side of the law. Although many people ...

Thesis Statement

Introduction In the recent economic times, the advanced technology has been able to facilitate innovative online business platform where consumers can easily purchase products over the internet. However, this has developed various impacts with regards to the economy due to the increased online shopping by a majority of the modern consumer. It is believed that online shopping will continue to present tremendous impacts to the economy due to its acceptance by the majority of consumers in the global markets. This study will therefore, seek to reveal the impacts of online shopping to the economy by taking an in depth ...

Financial Reporting

Customer Inserts Tutor’s Name (30, 09, 2013) Deferred tax asset is an asset reported on the Statement of Financial Position of a company that will be used in paying taxes for subsequent accounting periods. From financial point of view, deferred tax assets actually reduce the income tax expense for the upcoming periods. On the contrary, the deferred tax liability is an account on the balance sheet which appears because of the temporary differences arises as a result of difference between the profit calculated for accounting purposes and profit computation for the purpose of taxation. In the year end ...

Introduction

The America constitution entitles every citizen the duty of paying income taxes. The criteria use to implement the law on taxes payer has created a feeling of unfairness. The outcome from the taxation practice has resulted in taxpayers developing an interest or idea of renouncing their U.S citizenship in order to evade paying the income taxes. Renouncing of US citizenship is justified in the immigration and nationality act. It therefore implies that most of the US citizens have escaped paying their taxes. This is because it is a right for every citizen; it therefore plays a very fundamental role in tax ...

Introduction

The US government takes renunciation of US citizenship with a lot of seriousness. Whoever wishes to renounce citizenship has to do so by following the right procedure. The person must appear in person at an embassy of the US. After renouncing citizenship, the petitioner loses the rights that are enjoyed by the citizens of the US. It therefore becomes impossible for the petitioner to freely travel and enjoy privileges in the US. The US allows individuals with a positive intention to renounce citizenship but not those who are trying to evade their responsibility to the tax department or the military. ...

Executive Summary 3

Overview of Current Situation 3 Summary of Needs and Objectives 4 Summary of Recommendations 4 Summary of Expected Outcomes 4 Important Information 5 1.0 Objective 6 2.0 Current Situation 6 2.1 How to get there 7 3.0 Recommendation 1 9 3.1 What is Salary Sacrifice? 9 3.2 Steps 9 3.3 Benefits of the Recommendation 11 3.4 Risk Associated with the Recommendation 13 4.0 Recommendation 2 14 4.1 Steps 15 4.2 Benefits of the Recommendation 15 4.3 Risk Associated with the Recommendation 15 ...

Executive summary

This article discusses the topic are there issues with revenue –neutral carbon tax as reported on the wall street journal of April 17th 2013.with increased campaign on the need for reduction on emissions that have caused an increase in the quantity of green house gases that have led to dramatic climatic changes. According to the Washington post of 25th April 2013, it’s depicted that, “For years it’s been obvious in policy-wonk circles that a carbon tax is a great idea.” Many nations especially the developed ones like those in Europe have in America have opposed this move ...

Executive summary.

The article discusses the most efficient ways to enhance ethics in cooperates within the United States of America. Good business are built and sustained by the reputation they have to the outsiders who include the shareholders, bondholders, the government, credit suppliers and the clients. The reputation the company has to the insider who include the employees both at the lowest, middle and top calibers .the article have discussed the causes of collapsing of the business ethics and what can be done to remedy this situation.

Introduction.

Today the world is being regarded as a global village and from this claim many ...

Management Memorandum

The main purpose of this memo is to clarify on some issues based on the LIFO inventory management of stock. Over the recent past, it has been noted with a lot of concern that the cost of managing the stock has been tremendously increasing. As a result, some of the existing policies have been modified to rectify the situation while other new policies have been put in place to enable a smooth flow of inventories with no major cost challenges. Increasing stock costs has resulted into the firm incurring increasing losses due to increased costs. After a comparative study of the stock ...

Article Comparison Essay

The author has used the application of paragraphs in the two articles differently. In article B, the use of paragraphs does not have indentation. The paragraphs are separated by double spaces. The first article A, all paragraphs are indented. Paragraphs in the second article are composed of as little as one sentence. In writing formal work, a paragraph consists of a minimum of three to four sentences. Paragraphs need to be detailed in explaining the main idea presented in the topic sentence of the paragraph. In the first article, the paragraphs are more detailed and present more information on the idea ...

Introduction

Many US expatriates have of late been feeling that a very large proportion of their income is being lost in the name of paying taxes and are therefore earnestly seeking for ways through which they can reduce their tax liability. This is very important because avoiding tax using illegal means comes with very expensive penalties that are not easy to bear. This means that the only means by which they can save their income from being largely expended on tax is through the use of legal means of reducing their tax liability. One of these means is through renouncing U.S. ...

Long-Term Financing

Question 1 Suppose that a firm is operating with neutral corporate and personal taxes in an otherwise perfect capital market and Equation (I6.7) currently holds. In such a world, a firm would never take on any risky debt. Why not? (Hint: Consider what would happen in financial distress). When a firm is operates in an environment with neutral corporate and personal taxes imply that the source of financing has no impact on the tax liability of the firm. Normally, companies usually borrow debt to reduce their tax liability by deducting interest expense. Interest expense is an allowable expense for tax purposes, ...

According to the U.S. Bureau of Economic Analysis social benefits for the first half of 2011 increased by 25 billion dollars. They account for more than 45 percent of the total governmental spending and have a significant impact on the economic structures in the country. Such vast governmental expenditures are made possible through the transfer of money from the taxpayers to the recipients of the welfare, unemployment benefits etc. both on the federal and local/state level. However, recent statistics shows that despite constant investment into social benefits, poverty has not decreased. Moreover, the amount spent on social programs could have ...

Introduction

The Federal income tax forms are developed in a way that suits the social and economic conditions of all the federal tax payers. This means that the forms put into consideration the different aspects of life evident in the lives of the taxpayers. These aspects of life include but not limited to marriage, education, income earned or generated, age, health and social schemes, business and overall functionality of the economy. In this regard, the individual tax payers’ decisions on the forms to choose when it comes to payment of federal taxes are greatly influenced by these life aspects in the ...

The estate plan is intended to reduce the amount of both federal and state tax payable on the gross estate of the clients. The estate plan seeks to develop efficient gifting plans by the clients to specific beneficiaries and effectively reduce the amount of tax that is payable from the gifting plans to the minimum. The estate plan should enable Rich distribute his estate to all his beneficiaries without any conflict of interest arising from the remarriage of his wife after his death. The estate plan seeks to revise the client’s will to be more effective and ...