Homework SourseTCO C Terry is a sole proprietorship He desires to be taxed
(TCO C) Terry is a sole proprietorship. He desires to be taxed as a corporation. What does he need to do?
| Create a new entity |
Solution
A sole proprietorship is a type of business which is owned by an individual. Sole proprietors are taxed as an individual.
For a sole proprietorship to be taxed as a corporation, the sole proprietor first needs to create a legal entity. Once the legal entity is created the proprietor can file to be taxed as an S corporation.
Hence the first option is correct.
