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Gonzalez Corp. has made S - election on the date of its incorporation in year 2012....

Gonzalez Corp. has made S - election on the date of its incorporation in year 2012. For the year 2019, Gonzalez has a gross receipt for the year totaling $350,000 of which $100,000 is passive investment income. Expenditures directly connected to the production of the passive income total $35,000. Calculate Gonzalez Corp.’s passive investment income tax (assume the tax rate 21%). Please show all calculations.

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Answer #1

Net Passine income = $100000 - $35000 - 465000 Amount of passive income that exceeds 254. of gross Receipts. $ 6250 0. [$ 100

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