Your client, Edward Bolleni, CPA has recently left his Big Four position and is

Question

Your client, Edward Bolleni, CPA has recently left his Big Four position and is “out on his own”. After preparing tax returns for the 2016 tax year, Mr. Bolleni has decided to operate his own accounting firm. Mr. Bolleni wants limited liability protection in his operations as an accountant, as well as, liability protection from any accidents or slip and falls that would occur in his accounting office. Mr. Bolleni has an accounts receivable worth $50,000 for tax preparation fees for the 2016 tax year, as well as, an interest in a real estate partnership that is used as collateral for a loan that Mr. Bolleni received from Bank of America so that he could have additional capital for his new business. The fair market value of the real estate partnership interest is $500,000 and the loan is for $200,000. Mr. Bolleni comes to your office and asks you the following questions

Question

Which type of legal entity would be best suited to provide the type of limited liability protection the taxpayer is seeking?

Explanation / Answer

Answer :- Limited Liability Company (LLC).

Explanation :- Limited Liability Company (LLC) is very suitable form of legal entity providing the legal protection to taxpayer in the above given question.

Related Questions

Navigate

• Browse (All)
• Browse Y
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.