Madden is a 100-percent owner of MD LLC (taxed as an S corporation). He works full time for MD and his marginal ordinary tax rate is 37 percent. Which of the following statements is true regarding Madden's tax treatment of business income allocated to him from MD? Question 10 options: Business income allocations are subject to self-employment tax. Business income allocations are not subject to the net investment income tax. Business income allocations are subject to the additional Medicare tax. Business income allocations are taxed at a maximum 23.8 percent tax rate.
Madden is a 100-percent owner of MD LLC (taxed as an S corporation). He works full time for MD and his marginal ordinary tax rate is 37 percent. Which of the following statements is true regarding Madden's tax treatment of business income allocated to him from MD? Question 10 options: Business income allocations are subject to self-employment tax. Business income allocations are not subject to the net investment income tax. Business income allocations are subject to the additional Medicare tax. Business income allocations are taxed at a maximum 23.8 percent tax rate.
Chapter23: Exempt Entities
Section: Chapter Questions
Problem 19P
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Question
Madden is a 100-percent owner of MD LLC (taxed as an S corporation). He works full time for MD and his marginal ordinary tax rate is 37 percent. Which of the following statements is true regarding Madden's tax treatment of business income allocated to him from MD?
Question 10 options:
|
Business income allocations are subject to self-employment tax. |
|
Business income allocations are not subject to the net investment income tax. |
|
Business income allocations are subject to the additional Medicare tax. |
|
Business income allocations are taxed at a maximum 23.8 percent tax rate. |
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