Tax Memo: Pension Payments Mr. Jones From, Case Study

Open, View, and/or
Download this Document

Total Length: 466 words ( 2 double-spaced pages)

Total Sources: 0

Page 1 of 2

Tax Memo: Pension Payments

Mr. Jones

From, Tax Accountant, CPA

You are the president of a corporation owned by yourself and other family members. Your salary from this corporation during the year in question was $48,000. During this same year, $12,000 was also contributed by the corporation to a pension plan held on your behalf. You believe that this contribution should not be considered a part of your taxable income for the year in question. The IRS agent conducting an audit of the year in question believes the pension plan amount should be considered when making a determination of reasonable compensation.

The issues in this case are (1) whether it is proper to include the pension plan in a determination of compensation, and (2) if such inclusion would affect the determination of the compensation amount of any tax liabilities for the corporation or Mr. Jones during the year in question.

Stuck Writing Your "Tax Memo: Pension Payments Mr. Jones From," Case Study?

View All Our Example Tax Memo: Pension Payments Mr. Jones From, Case Study

Have A Custom Example Essay Written



Rule

Allowance for retirement benefits, received or not received, has been made by the tax court in previous cases where disputes of reasonable compensation have arisen (Brewer Quality Homes, Inc. v. Commissioner of Internal Revenue, 2003). This would suggest that pension contributions by the employer are part of a reasonable compensation determination. While the Tax Court allowed only a 5% allowance for retirement benefits in addition to actual income in this case, the total compensation level at issue was higher by more than….....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Tax Memo Pension Payments Mr Jones From " (2012, April 10) Retrieved June 7, 2026, from
https://www.aceyourpaper.com/essays/tax-memo-pension-payments-mr-jones-56092

Latest MLA Format (8th edition)

Copy Reference
"Tax Memo Pension Payments Mr Jones From " 10 April 2012. Web.7 June. 2026. <
https://www.aceyourpaper.com/essays/tax-memo-pension-payments-mr-jones-56092>

Latest Chicago Format (16th edition)

Copy Reference
"Tax Memo Pension Payments Mr Jones From ", 10 April 2012, Accessed.7 June. 2026,
https://www.aceyourpaper.com/essays/tax-memo-pension-payments-mr-jones-56092
   

Open, View, and/or
Download this Document
order custom essay example