Internal Memo To: PBR (Park, Baines, and Rowe), LLC Subject: Partnership taxation Date: 26th July 2020 Facts This memo is to explain the way forward in treating Baines and Park as employees of PBR LLC and also the subject of self-employment taxes (Koski, 2005, p.33). This memo serves as a guide and reference for assisting PBR LLC and the management with the changeover of the company to LLC. For the last 15 years, PBR has been operating as an S corporation with three partners. The partners agreed on paying Baines and Park $200,000 each as they did before the company transited. Loses and profits are shared equally by all the partners. They decided to take $40,000 cash distribution to each