During a Recent IRS Audit, the Revenue Agent Decided That

question 33

Essay

During a recent IRS audit, the revenue agent decided that the Emig family used their closely held corporation, Gamekeeper, to avoid shareholder tax by accumulating earnings beyond the reasonable needs of the business. Gamekeeper's taxable income was $800,000, it paid no dividends, and it had no business need to retain any income. Compute Gamekeeper's accumulated earnings tax assuming that it had accumulated $2 million of after-tax income in prior years.

---

Definitions:

Cloning

The process of creating an identical copy of an organism or cell, either naturally or through scientific methods.

Behavioral Genetics

The study of the role of genetic and environmental factors in shaping behaviors and personality.

Heritability Coefficient

Heritability coefficient is a statistical estimate that indicates how much of the variation in a particular trait within a population can be attributed to genetic differences among individuals.

Twin Studies

Research studies that compare the similarities and differences between monozygotic (identical) and dizygotic (fraternal) twins to understand genetic and environmental influences on traits.