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Mary (who is single with no dependants [1 personal exemption - $3,800] and who does not itemize [standard deduction - $5,950]) owns 100% of Beezer...

Mary (who is single with no dependants [1 personal exemption - $3,800] and who does not itemize [standard deduction - $5,950]) owns 100% of Beezer Tweezer Co, which is organized as a C-Corporation. Beezer Tweezer has $400,000 of taxable income in 2012 and Mary has $34,500 of outside ordinary income before any wage compensation from Beezer Tweezer. Assuming reasonable compensation for Mary’s services to Beezer Tweezer would fall in the range of $150,000 to $250,000, which of the following wage distribution amounts to Mary would result in the lowest overall combined federal income tax liability for Mary and Beezer Tweezer (ignore any payroll taxes)?
A) $150,000

B) $200,000

C) $250,000

D) Taking no wages from Beezer Tweezer.
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Accounting-8367645.doc

Mary (who is single with no dependants [1 personal exemption - $3,800] and who does not itemize [standard deduction - $5,950])
owns 100% of Beezer Tweezer Co, which is organized as a C-Corporation....

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