Hakeem, one of your firms clients, is a shareholder in Cedar Corporation. Cedar Corporation has...
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Hakeem, one of your firms clients, is a shareholder in Cedar Corporation. Cedar Corporation has an S corporation election in effect. During the 2020 calendar tax year, the corporation had ordinary taxable income of $200,000, and on January 15, 2020, the corporation paid dividends to shareholders in the amount of $120,000. Hakeem has asked what how much of that he needs to report on his income taxes. Your supervisor has asked you to follow up with Hakeem to get the information needed to make this determination. Write a letter to Hakeem explaining how his taxable income would be calculated and asking for the information that is still required.
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