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Tangerine, Inc., a calendar-year C corporation, has $800,000 of qualified production activities income (QPAI) and $950,000 of total taxable income in...
Tangerine, Inc., a calendar-year C corporation, has $800,000 of qualified production activities income (QPAI) and $950,000 of total taxable income in 2017. All of the QPAI was produced by Tangerine's manufacturing plant, which relies mainly on a temporary employment agency for its workforce, employing only two W-2 employees who in aggregate earned $140,000 in 2017. Tangerine also has an office in Mexico, which is unrelated to its domestic manufacturing plant and which employs one W-2 employee, who earned $75,000 in 2017. What amount of DPAD may Tangerine claim on its 2017 corporate tax return?
A. $73,350
B. $72,000
C. $70,000
D. Depends on the wages paid by the employment agency.
