Exam 10: Taxation of Corporations

What are the ownership requirements for filing a consolidated return?

If property is distributed to a shareholder as a dividend, the dividend is equal to the property's fair market value.

A sole shareholder receives a piece of land from a corporation as a dividend distribution. The land has a basis of $40,000 and a fair market value of $80,000; the shareholder's basis in his stock is $20,000, and this distribution is the only corporate activity for the year except for paying any tax owed on the land distribution. At the beginning of the year, the corporation had only $5,000 in accumulated earnings and profits. How will this distribution be treated for tax purposes by the shareholder?

Jude received a $25,000 distribution from BC Corporation that the corporation identified as $15,000 dividend and $10,000 return of capital. What effect does this distribution have on Jude's taxable income if his basis in the stock of BC is $8,000?

The unextended due date for a corporate tax return is the 15^th day of the fourth month after the close of its tax year.

A corporation has a July 30 year end. What is the last date it can file its return due for its July 30, 2018 year end if it files an extension?

Monroe Corporation reported the following results for the current year: In addition to the above, Monroe Corporation has a $5,000 NOL carryforward available from last year. What is Monroe Corporation's taxable income for the current year?

How does a corporation treat a net short-term capital loss realized in the current year?

An exempt organization normally operates as a:

Avalanche Corporation has $70,000 of net income from operations during the current year. In addition it received $180,000 of dividend income from another corporation in which it has a 10% ownership interest. What is Avalanche's dividends received deduction for this year?

Which of the following is not a characteristic of a corporation?

What is the percentage excise tax that a disqualified person can be assessed on a prohibited transaction if that person fails to correct the transaction?

Casey Corporation has three assets when it decides to liquidate: The corporation sells the stock for its fair market value and distributes the other two assets to its sole shareholder. What is its tax liability on its final tax return in 2018 if it had $45,000 of income from operations prior to liquidating?

Coho is a corporation that has $1,100,000 of gross revenue and $1,021,000 of deductible expenses? What is its income tax liability for 2018?

The following shareholders own the outstanding stock of Garcia Corporation: Ryan is a 25% partner in AG Partnership. Ryan also is a 55% shareholder in XYZ, Inc. and a 40% shareholder in RST, Inc. How many shares does Ryan constructively (directly and indirectly) own?

An exempt organization will not be assessed an unrelated business income tax if:

What avenues are available to a corporation to obtain capital for operations?

Corporation P files a consolidated return with Corporation S. In preparing a consolidated return, their accountant finds the following: What is the consolidated return taxable income?

A clothing manufacturing corporation donates last year's inventory to the Red Cross for use in its disaster relief efforts. The clothes have a fair market value of $200,000 and a basis to the corporation of $75,000. What is its charitable contribution deduction?

What is the amount of the exemption an exempt organization is permitted for unrelated business income?