Moana is a single taxpayer who operates a sole proprietorship. She expects her taxable income next year to be $250,000, of which
$200,000 is attributed to her sole proprietorship. Moana is contemplating incorporating her sole proprietor-ship. Using the single individual tax brackets and the corporate tax brackets,find out how much current tax this strategy could save Moana (ignore any So-cial Security, Medicare, or self-employment tax issues). How much incomeshould be left in the corporation?
