Overview
Deliverables and group steps to complete:
Deliverable #1:
You will complete the attached Excel Spreadsheet (complete all tabs), using the projected revenues and expenses to determine the total federal income tax liability for the entity, the owners, and Elsa if Bradshaw Board Games is formed as a C corporation.
- Assume the entity is formed and begins operations on January 1, 2025, and perform this analysis for 2025–2027. In addition to projections for the business, Bill and Danny have provided projections for their personal tax As noted previously, the owners have a series of outlays that the entity will make related to buying property with an existing warehouse and obtaining a patent. First perform this analysis assuming Bradshaw Board Games does not hire Elsa as an employee beginning January 1, 2026.
- Then, perform the analysis again assuming Bradshaw Board Games does hire Elsa as an employee beginning January 1, 2026 (using the projected salary figures noted in Bill’s email).
- Use the projected revenues and expenses to determine the total federal income tax liability for the entity, the owners, and Elsa if Bradshaw Board Games is formed as a partnership. Perform the analysis once assuming Elsa is not hired as an employee, then perform the analysis again assuming Elsa is hired as an employee.
The Deliverable – the Excel Spreadsheet must be uploaded to Canvas (one per group) on or before Monday, December 1st 4:00 PM
Deliverable #2
Prepare a tax research memorandum addressing the following items:
- The tax implications of forming Bradshaw Board Games as a C corporation versus a partnership, considering:
- Start-up losses and deductions
- Basis limitations.
- Double taxation of C corporations.
- Qualified Business Income (QBI) deduction for partnerships.
- Tax treatment of patent acquisition costs and amortization.
- Treatment of passive versus active participation (especially relevant to Danny).
- The potential employment of Elsa (a related party) and implications under Section 267 and reasonable compensation rules.
- Whether the choice of entity has implications for planned property acquisition in 2026.
- Conclude with a recommendation that considers tax efficiency, owner cash flow, and future business plans.
The Deliverable must be uploaded to Canvas (one per group) on or before Monday, December 1st at 4:00 PM. In addition to using citations for primary sources in the tax memorandum, your group is required to include a hyperlink to all RIA Checkpoint resources used to research these issues. If your group does not include the hyperlinks (on a separate page from the actual Tax Memorandum), your group members will not receive credit for this deliverable.
Deliverable #3
A PowerPoint (.pptx) slide deck outlining your findings. Create up to 25 slides to illustrate the key points of your presentation. Be sure to use standard fonts your readers are likely to have on their computers. Your group will need to prepare a PowerPoint presentation with a 10-minute oral presentation to Bill and Danny and Bradshaw Board Games, including a recommendation on whether the owners should operate the business as a C corporation or a partnership. Provide support for your recommendation.
- Be sure to quantify the effect of hiring Elsa on the total federal income tax liability. In each analysis, include a calculation of the net present value of the total federal income taxes paid by the entity, the owners, and Elsa assuming a discount rate of 8 percent.
- Besides determining the total federal income tax liability for each option, Bill and Danny would also like us to identify other considerations that may influence their What are some key tax issues they should consider, both today and in the future? What other factors, besides tax, should they consider?
The Deliverable – the PowerPoint presentation along and voice-over presentation is due on or before Monday, December 1st, 2025 . Please also upload a copy of the PowerPoint presentation to Canvas and a voiceover presentation to Canvas on or before Monday, December 1st 4:00 PM. ALL group members must participate in the presentation (in addition to all other aspects of the deliverables).
- Please note – I do not want to see any ‘copy/paste’ of the Excel file, the slide presentation should include graphs where fitting, and bullet points. This presentation should be as if you were preparing it for your client (lay-person terms, and the analysis should include only the information necessary for the slides, for example do not include all information from the excel file, only the items you want to emphasize. Further, for the non-tax and other considerations please speak to these but only include bullet points or summaries in the PowerPoint. Please refer to the suggestions for a good PowerPoint presentation in the supplemental file.