Question;TAX RESEARCH MEMORANDUM ASSIGNMENT 1;As we learned in Week 4, the;Code allows taxpayers to take a deduction for the cost of meals when taxpayers;have been deemed to be "away from home" for tax purposes. This;determination can be difficult. Two separate clients came to you with questions;as to whether they are entitled to take a deduction for the cost of meals;incurred during a particular trip. The facts pertaining to each are;1. Tracey is a sales;representative for a national pharmaceutical company. She has a rather large;sales territory, and she makes her rounds to her customers using a;company-owned car over a 16- to 19-hour period of time. During these one-day;business trips, Tracey will pull over in a suitable location (such as a park or;a rest stop) and take a short nap in the backseat of her automobile.;2. Mark captains a ferryboat.;This ferryboat carries tourists on roundtrips from Seattle to Victoria and;back, each trip of which lasts from 15 to 17 hours and provides for a 6- to;7-hour layover in Victoria. During the layover, Mark typically takes a;four-hour nap on a cot that he has stored in the pilothouse of the ferryboat.;Under each of these;circumstances, if the taxpayer entitled to deduct the cost of meals purchased;during the trip at issue?;TAX;RESEARCH MEMORANDUM ASSIGNMENT 2;It appears as though a couple;of your clients have encountered an unfortunate development in their financial;situation. Cindy and Ralph Edmonds own TidyCo., Inc. TidyCo, in turn, owns and;operates several coin Laundromats in and around Dubuque, Iowa. Over the last;two years, the;Edmonds made weekly deposits;of the Laundromat receipts to corporate and personal bank accounts. However, it;now also appears (unknown to you!) That they also siphoned off a portion of the;weekly collections and took them home rather than depositing them. These;amounts, which appear to total about $200,000 were hidden in shoe boxes around;the house and (surprise!) were not reported as income.;The IRS found out about these;amounts and has notified them that it intends to bring criminal tax evasion;charges against them under Section 7201 of the Code. The IRS has made quite;clear that it believes that the Edmonds? actions constituteprima facieevidence that;they intended to defraud the government and should therefore be liable under;the statute.;As their accountant, you know;that TidyCo has a deficit in both its accumulated and current E&P accounts;and that this deficit has existed over the entire period that the IRS contends;the Edmonds illegally invaded income taxation. It also appears as though the;Edmonds? basis in their TidyCo stock is $300,000 (before the stashed-away money;at their home is considered). Do these facts have any bearing on the evasion;charges the IRS seeks to bring against them?;RESEARCH;ESSAY ASSIGNMENT 1;We spent a substantial amount;of time in Week 4 discussing the payment and taxation of corporate dividends.;Some of this discussion simply begs the question as to how commonplace dividend;distributions are in the United States. Utilizing at least three (3) commercial;or journal related websites, ascertain and detail how common dividend;distributions are in today's economic climate, particularly since the economic;downturn of 2008 and 2009. Furthermore, ascertain and analyze whether dividend;distributions are concentrated in the companies that are publicly traded (such;as the New York Stock Exchange or NASDAQ) or whether closely held corporations;pay them with equal frequency and/or at the same rates. In your analysis, make;sure that you discuss and consider the various considerations that each type of;corporation (publicly traded and closely held corporations) balance in;determining whether to pay dividends, including the tax consequences of doing;so.;NOTE;You must either (1) submit complete citations to these online resources so that;your instructor may find these studies online or (2) submit complete copies of;these online resources with your submission. Failure to do so will result in a;zero for the assignment.
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