Question 1

Which of the following tax levies imposed on an S corporation are required to be paid by using estimated tax payments?

Accepted Answer

A)  built-in gains tax 
B)  excess net passive income tax 
C)  both A and B 
D)  none of the above 
A)  built-in gains tax 
B)  excess net passive income tax 
C)  both A and B 
D)  none of the above

Question 2

King Corporation, a cash method taxpayer that uses the calendar year as its tax year, was incorporated on June 1, 1984. The corporation made its initial S election on December 1 of last year, effective for the current tax year. Earnings and profits of $60,000 have been retained from C corporation tax years. Which one of the following events results in the recognition of a built-in gain?

Accepted Answer

A)  collection of accounts receivable in the current year that resulted from services performed last year 
B)  collection of interest income earned in the current year on bonds purchased on January 1 of last year 
C)  collection of dividends declared on April 5 of the current year on stock purchased on February 14 of the current year 
D)  None of the above are built-in gains. 
A)  collection of accounts receivable in the current year that resulted from services performed last year 
B)  collection of interest income earned in the current year on bonds purchased on January 1 of last year 
C)  collection of dividends declared on April 5 of the current year on stock purchased on February 14 of the current year 
D)  None of the above are built-in gains.

Question 3

Caravan Corporation has always been an S corporation. Caravan Corporation is 100% owned by Alan Merten. On January 1, Alan has an adjusted basis of $50,000 in his Caravan stock. During the year, Caravan reports ordinary income of $60,000, a long-term capital gain of $10,000, and a charitable contribution of $5,000. Alan receives a $20,000 cash distribution from Caravan on December 1. What income does Alan recognize from the distribution, and what is his basis in the Caravan stock at year-end?

Accepted Answer

Basis = $50,000 + $60,000 + $1

Which of the following tax levies imposed on an S corporation are required to be paid by using estimated tax payments?

Tax Research

Corporate Formations and Capital Structure

The Corporate Income Tax

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

The Gift Tax

The Estate Tax

Income Taxation of Trusts and Estates

Administrative Procedures

Us Taxation of Foreign-Related Transactions

Filters

Exam 11: S Corporations

Which of the following tax levies imposed on an S corporation are required to be paid by using estimated tax payments?

Tax Research

Corporate Formations and Capital Structure

The Corporate Income Tax

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

The Gift Tax

The Estate Tax

Income Taxation of Trusts and Estates

Administrative Procedures

Us Taxation of Foreign-Related Transactions

Filters