S Corporations and IRC Section 199A: Incorporating Excel Into Tax-Planning Scenarios

This case requires students to take a multi-year tax-planning perspective for an S Corporation owner-employee. The case emphasizes the Internal Revenue Code (IRC) §199A deduction (qualified business income (QBI) deduction, created by 2017 Tax Cuts and Jobs Act) and electronic spreadsheet skills. The...

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Bibliographic Details
Published in:Issues in accounting education 2021-08, Vol.36 (3), p.91-102
Main Authors: Cooper, Lauren A., Key, Kimberly G., Mathis, Mollie E.
Format: Article
Language:English
Subjects:
Accounting
College students
Decision making
Internal Revenue Code
S corporations
Spreadsheets
Tax Cuts & Jobs Act 2017-US
Tax deductions
Tax legislation
Tax planning
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Summary:This case requires students to take a multi-year tax-planning perspective for an S Corporation owner-employee. The case emphasizes the Internal Revenue Code (IRC) §199A deduction (qualified business income (QBI) deduction, created by 2017 Tax Cuts and Jobs Act) and electronic spreadsheet skills. The case also includes reasonable compensation and cost recovery issues. Students perform tax research to identify factors relevant to QBI deductions and apply this research to make QBI deduction calculations. Then, students demonstrate knowledge of the flow-through entity by incorporating IRS rules and logic into electronic spreadsheets. Finally, students improve their tax-related decision-making skills by evaluating scenarios related to the QBI deduction in a flow-through entity setting.
ISSN:0739-3172
1558-7983
DOI:10.2308/ISSUES-19-059