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Running Head: Business entity d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d
Business Entity: Milestone One Memorandum –
Business entity d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d 2
Subject: Recommendation for ideal business entity type
A. Justification for choosing the recommended taxable entity
On the basis of the tax research that has been conducted, the most viable business entity option
for Bob Jones a partnership form of business. a partnership, two or more individuals is In
combine their resources order carry out business activities. choosing this business type in to By
Bob and his daughter Mandy would be able share the risks well profits and losses of the to as as
newly formed business. Based on the business type, the tax would computed personal tax, be as
and they would have pay the tax only once the income. Based on the Internal Revenue to on
Service (IRS), a partnership entity has have file annual information return for reporting to to an
the income along with deductions, losses and gains (Partnerships: Internal Revenue Service).
Form W-2 would be issued, and the partnership would have furnish copies relating to to
Schedule K-1 to the partner.
B. Accounting Method d
The accounting method that would be applicable the partnership business give rise a to can to
host of advantages for the new entity. The accrual method of accounting would be adopted,
