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April 8, 2012

Tax File Memorandum
From:., CPA. M.A.F.M
Subject: Mr. Jones Taxpayer Engagement
On today April 5th, 2012 I met with Mr. Jones regarding our Previous Meeting on April 2nd, 2012 to discuss some questions and doable outcomes about voltage future financial investment decisions, and the taxation ramifications of these decision and possible outcomes.
Facts:
Mr. Jones is considering the barter for of a manufacturing comp each Smithton Widgets which is actually profitable. Mr. Jones is a majority shareholder in another C-Corp. cognise in this case as Johnson function which has accumulated meaning(a) losses.
Issues:
1.Outstanding purchase of stock
(a)Mr. Jones would like to know if he should purchase the stock of Smithton outright, leaving Smithton intact. He also wants to know if he issues debt in his Johnson serve to pay for the Smith Company would that tramp debt to equity issues
(b)Mr. Jones also wanted to know should he commute Smithton to an S Corporation and change the fiscal year to a calendar year.
(c)Mr. Jones also asked what are the potential tax ramifications that hold out for Mr. Jones personally if he purchases the stock of Smithton and converts it to an S- Corporation.?
(d)Mr. Jones asked should he merge with Johnson Services with Smithton, and what type of merger would be best.
2.



Merger or acquisition
(a)If the deuce companies are merged, could Smithton use Johnson Services net operating loss lend forwards? Any limitations on their use?
(b)Should Mr. Jones use Johnson Services stock to acquire Smithton? Why or why not?
(c)Would a merger or acquisition affect Mr. Jones big businessman to change Smithsons fiscal year-end to a calendar year-end? Could Smithton be converted to an S corporation?
(d)Does the potential of significant capital investment in Smithton affect any of your answers for 2(a)-(c) above?
Conclusion:
1.
(a)I recommend that Mr. Jones dont purchase the stock of Smithton outright. If Mr. Jones did purchase this...If you want to get a full essay, order it on our website: Orderessay



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