Kirk Is Establishing a Business in 2010 Which Could Have

question 87

Essay

Kirk is establishing a business in 2010 which could have potential environmental liability problems.Therefore,he is trying to decide between the C corporation form and the S corporation form.He projects that the business will generate losses of approximately $100,000 each year for the first 3 years and then will generate profits of at least $200,000 each year thereafter.All profits will be reinvested in the growth of the business.Kirk projects he will be in the 35% bracket in 2010 and thereafter.Advise Kirk on which tax form he should select.

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Definitions:

Hysterotomy

A surgical incision into the uterus, commonly performed during certain types of abortion or to remove fibroids.

C-section

A surgical procedure to deliver a baby through incisions in the abdomen and uterus.

Fibroids

benign tumors of the uterus composed of muscle and fibrous tissue, which can cause heavy menstrual bleeding and pain.

Benign Uterine

typically refers to non-cancerous conditions affecting the uterus, such as fibroids.