Simplified method, "simplified," I interpret to be ratio of Ordinary Income to Total Income = %. This % applies to QPA revenue. Correct?
Question. Since QPA Income should NOT include COGS, I assume I am correct in using Ordinary Income divided by Gross Income ("Total Income") (not Gross Revenue) to determine % of QPA Revenue for pass-through to shareholder. Correct?
To be specific - from 1120S (and by the way, these is 2005 returns):
Gross Revenue, $358,580
COGS $179,467
Other Income $33
Total Income, line 6 $179.146
Total Deductions, line 20 $148,141
Ordinary Income, line 21 $31.005
I calculate % pf QPA Revenue for 8903 Pass-through to shareholder to be 18%, i.e., $31,005 / $179,146. Correct?
Final figure for QPAI entry on K-a and taxpayer's 8903 is 18% x QPA Revenue. Correct?
Thanks.
Question. Since QPA Income should NOT include COGS, I assume I am correct in using Ordinary Income divided by Gross Income ("Total Income") (not Gross Revenue) to determine % of QPA Revenue for pass-through to shareholder. Correct?
To be specific - from 1120S (and by the way, these is 2005 returns):
Gross Revenue, $358,580
COGS $179,467
Other Income $33
Total Income, line 6 $179.146
Total Deductions, line 20 $148,141
Ordinary Income, line 21 $31.005
I calculate % pf QPA Revenue for 8903 Pass-through to shareholder to be 18%, i.e., $31,005 / $179,146. Correct?
Final figure for QPAI entry on K-a and taxpayer's 8903 is 18% x QPA Revenue. Correct?
Thanks.