Accounting

Instructions

Please read Ethics & Equity When is a Dairy Farm a Trade or Business . (Links to an external site.)Links to an external site. Is the position by Randolph defensible?  Review the 9 factors from the IRS website:https://www.irs.gov/hobby-or-business-irs-offers-tips-to-decide (Links to an external site.)Links to an external site.considered to help determine whether an operation should be considered a business or hobby in 2017. You may also want to do some additional outside internet research on the subject, include in your own words and cite your sources. Instructions:-  Write a detailed memo to Randolph in Word with your research findings to properly advise him on this matter. Your memo will likely be several pages. To receive full credit your memo should satisfy the following three bullet points:- Address the majority of the 9 factors and indicate to Randolph whether each factor is supportive or not supportive of his farming operation being considered a business. -Based on your analysis of these factors, make an overall conclusion to Randolph for 2017 and tips for 2018 since the tax law has significant changes.

Answer

Memo To: Randolph From:date: 10/15/2018Subject: When is a Dairy Farm a Trade or Business?Your daily business venture and the medical practice connote two different businesses. However, the mere pronounced sentiment isnt enough to support the assertion. The federal tax obligation, demand remittance from economic ventures. Though you undertook the daily venture as a hobby, the compositional setup depicts a different scenario (Goss, 2015). The subsequent 9 factors evaluation from the IRS will offer a distinct position about the standing of the new setup. The fundamental basis of a taxable entity alludes to the following metrics. The entity has workers on salary, the owner commits effort with the aim of making the institution profitable, among many other variables. The first factor entails whe...
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