Assignment: FEDERAL INCOME TAX

THE POLYNESIAN RESTAURANT

Background

Use the facts of the Comprehensive Tax Project for The Polynesian Restaurant and the owners George, Kim, Martha and Tom.

Task

Part 1. Evaluation of Formation and Operational Issues.

With regard tothe proposed ownership and capitalization, with regard to your client Tom only, evaluate the formation and operational issues onlyin doing business as either (a) a General Partnership, (b) LLC or (c) Corporation. Your evaluation should address the issues such asformation, management, liability for the business's liabilities, the transferability of the ownership interest,and death of owners.

You should stay within the parameters of the facts set forth. Consider the other owners ONLY to the extent it may affect Tom.

AND: ONLY discuss the formation and operational issues. The issues related to income taxes will be evaluated in the Comprehensive Tax Project (see Instructions Posted in Assignments). As the Comprehensive Tax Project and this Tax Memo address related issues, you may refer to your evaluation in the other as necessary to explain your evaluation in this assignment but keep the references to a minimum.

Part 2.YourRecommendation.

Which form of doing business would you recommend? Explain your recommendation.

INSTRUCTIONS

Your submission must be in Memorandum format and must be 4 to 6 pages (not counting cover page, exhibits and references), single-spaced, 12 pt. Arial or Times New Roman font, analyzing ONLY the questions set forth above.

All references must be set forth in APA Format. It is acknowledged that APA Format requires single-spaced format which is waived.

Also, there is no need for an Abstract or Introduction. Write your answer in Memorandum format as if presented to a client. You can address it to me.