1.
federal taxation comprehensive.
hello could you help with this assignment please. Thanks.
Otther Corporation sends people to the state capital to lobby the legislature to build a proposed
highway that is planned to run through the area where its business is located.
a-- If Otter Corp incurs $ 3200 of expenses, what part, if any, of its expenses are deductible?
b- Would it make a difference if the proposed road were a city road rather than a state highway,
and Otter lobbied its local government?
c- Assume the same facts in part a except that Otter's total in house expenses are $1500. Are
these expenses deductible?
Solution
a)Expenses for the following activities are not deductible business expenses:
Lobbying Expenses, or expenses used to influence legislation at the local,state, or federal level.
Expenses for political activities, such as campaign dinners and events for political parties or
candidates
Political contributions or gifts to political candidates.
In addition, you cannot claim a charitable deduction for contributions to a group which conducts
lobbying activities that have a direct effect on your business.
b)Lobbying involves the advocacy of an interest that is affected, actually or potentially, by the
decisions of government leaders. Individuals and interest groups alike can lobby governments,
and governments can even lobby each other. The practice of lobbying is considered so essential
to the proper functioning of the U.S. government that it is specifically protected by the First
Amendment to the U.S. Constitution: "Congress shall make no law