Exam 10: Taxation of Corporations

A corporation can elect to carry a capital loss back first to the third preceding tax year before it is carried forward five years; alternatively, it can elect to only carry the capital loss forward.

BarBRanch has had taxable income of $450,000, $570,000, $760,000 and $680,000 in years 2016 through 2019, respectively.What were the equal minimum quarterly estimated tax payments for 2019 that BarBRanch should have made in 2019 to avoid any penalty?

A corporation that owns 72 percent of all the outstanding stock of another corporation:

A corporation is subject to both the personal holding company tax and the accumulated earnings tax.Its regular taxable income is $200,000.Its adjusted taxable income for imposing the personal holding company tax is $170,000 and its taxable income for determining the accumulated earnings tax is $230,000.What is the corporation's total tax liability?

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

A corporation with a tax liability of $20,000 cannot use a general business credit to completely eliminate its income tax liability.

Ponoco Corporation, which has current earnings and profits (CE&P) of $10,000 and accumulated earnings and profits (AE&P) of $30,000, makes a $41,000 distribution to its sole shareholder, Greg, at the end of the current year.Greg has a basis in his Ponoco stock of $2,000.What is the amount of taxable income Greg must report from the Ponoco distribution?

Corporation P files a consolidated return with Corporation S.In preparing a consolidated return, their accountant finds the following: Separate taxable income (loss) \ 500,000 (\ 200,000) Capital gain (loss) (\ 25,000) \ 50,000 Charitable contributions \ 20,000 \ 10,000 Dividend from S \ 10,000 What is the consolidated return taxable income?

What type of organization is always a private foundation?

Soledad received one stock right for every two shares of stock she owned.She owned 100 shares that she purchased two years ago for $1,000.Each of the 50 rights that she received allows her to purchase one share of stock for $15.The stock is currently selling for $22 per share.What is her basis in the 50 stock rights?

A corporation owns 90 percent of the voting power of a second corporation but only 70 percent of its total stock value.The corporations are:

Molokai Corporation distributed a building valued at $45,000 (basis of $20,000) to its sole shareholder.What is the effect of this distribution on the corporation's taxable income?

Christopher and Ashley, brother and sister, each own 50 percent (1,000 shares) of the stock of Walcott Corporation.This year, Walcott redeems 400 of Christopher's shares in a qualifying redemption in exchange for land valued at $300,000 (basis $175,000).The corporation's E&P prior to the redemption was $350,000.Walcott's tax rate is 21 percent.What is Walcott's E&P after the redemption?

Marlin Inc., a calendar-year corporation, has gross income from operations of $160,000 and dividend income of $100,000 from a 25% owned domestic corporation for the current year.Deductible business expenses for the year are $170,000.What is Marlin's dividend received deduction for this year?

Corporation P owns 100 percent of Corporation S.During the year, P sold land to S for $50,000 that had a basis of $25,000 and S purchased $30,000 of materials from P that P paid $20,000 for.P reported separate income of $200,000 and S reported separate income of $30,000.What is the income that Corporation P reports on its consolidated tax return?

A corporate carrying a net operating loss forward that was incurred in 2017 can only carry it forward for twenty years after being carried back two years.

A corporation that only has accumulated earnings and profits cannot make a dividend distribution.

An individual shareholder may receive sale treatment on a corporate redemption if the shareholder has all of his or her stock redeemed and no related parties own any of the same corporation's stock.

Monroe Corporation reported the following results for the current year: Gross income from operations \1 50,000 Operating expenses 154,000 Dividends from 30 \% owned domestic corporation 100,000 Long-term capital gain 2,000 Short-term capital loss (3,000) Charitable contributions 15,000 Included in the above is $5,000 of qualified production activities income.In addition, Monroe Corporation has a $5,000 NOL carryforward from last year.How much can Monroe Corporation take as a charitable contribution deduction in the current year?

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.