Exam 3: Corporations: Special Situations

A taxpayer who prepares and sells Mexican food at several of its restaurant locations can qualify for DPAD as to the receipts only from take-out orders and home-delivery sales.

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(True/False)

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Question 1

Correct Answer:

Verified

False

Sweet Corporation, a new corporation, has gross receipts of $4.9 million, $6.9 million, and $8.6 million in 2013, 2014, and 2015, respectively. Is this corporation a small corporation with respect to the AMT in years 2013, 2014, 2015, and 2016?

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(Essay)

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Question 2

Correct Answer:

Verified

Yes, Sweet is a small corporation in 2013, the first year, irrespectively of the gross receipts. Yes, for year 2014, because the average gross receipts for the first year do not exceed $5 million. Yes, for year 2015, because the average gross receipts for the first and second years do not exceed $7.5 million [($4.9 million + $6.9 million) = $11.8/2 = $5.9] Yes, for year 2016, because the average gross receipts for the three prior years [($8.6 million + $6.9 million + $4.9 million) = $20.4/3 = $6.8] are less than $ 7.5 million.

One of the components of DPGR is qualified production property (QPP). The QPP must be manufactured, produced, grown, or extracted entirely within the U.S.

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(True/False)

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Question 3

Correct Answer:

Verified

False

The domestic production activities deduction is limited to corporations.

(True/False)

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Question 4

Which of the following items will be an addition to AMTI in arriving at ACE?

(Multiple Choice)

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Question 5

Which statement is false?

(Multiple Choice)

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Question 6

Which of the following would not be a positive tax preference item in 2015?

(Multiple Choice)

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Question 7

Harvey, a real estate developer, pays Abe, a general contractor, to construct an office building. Abe has no DPGR since he does not own the property.

(True/False)

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Question 8

Ace Corporation incurred the following taxes for the current year: Ace Corporation's total tax liability is:

(Multiple Choice)

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Question 9

The DPAD is not allowed for AMT purposes.

(True/False)

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Question 10

Mayberry, Inc. engages in production activities that generate QPAI of $460,000 and taxable income (without taking into account the DPAD and NOL) of $600,000 in 2015. The company also has an NOL carryover to 2015 of $500,000 and qualified W-2 wages of $300,000. Calculate any DPAD.

(Short Answer)

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Question 11

The AMT exemption amount of $40,000 phases out entirely once a corporation's average gross receipts exceeds $310,000.

(True/False)

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Question 12

A small corporation with unused minimum tax credits may use what percentage of regular tax as a minimum credit in 2015?

(Multiple Choice)

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Question 13

If QPAI cannot be used in any one year due to the TI limitation, it can be carried over for 3 years.

(True/False)

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Question 14

Which entity is subject to the ACE provisions?

(Multiple Choice)

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Question 15

Gerbil Corporation was formed in 2005. If in 2015, it has average gross receipts of under $7.5 million, the company cannot be subject to the AMT.

(True/False)

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Question 16

Once a small corporation for AMT purposes, always a small corporation.

(True/False)

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Question 17

What amount of accumulated earnings of a service type corporation is considered within the reasonable needs of a business without the corporation having to show a bona fide business reason for the accumulation?

(Multiple Choice)

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Question 18

In 2015, May Corporation (a calendar year taxpayer) had the following transactions: For 2015, May Corporation's AMTI is:

(Multiple Choice)

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Question 19

Reasonable needs for purposes of the accumulated earnings tax do not include loans to shareholders.

(True/False)

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Question 20

Showing 1 - 20 of 99

A taxpayer who prepares and sells Mexican food at several of its restaurant locations can qualify for DPAD as to the receipts only from take-out orders and home-delivery sales.

Sweet Corporation, a new corporation, has gross receipts of $4.9 million, $6.9 million, and $8.6 million in 2013, 2014, and 2015, respectively. Is this corporation a small corporation with respect to the AMT in years 2013, 2014, 2015, and 2016?

One of the components of DPGR is qualified production property (QPP). The QPP must be manufactured, produced, grown, or extracted entirely within the U.S.

The domestic production activities deduction is limited to corporations.

Which of the following items will be an addition to AMTI in arriving at ACE?

Which statement is false?

Which of the following would not be a positive tax preference item in 2015?

Harvey, a real estate developer, pays Abe, a general contractor, to construct an office building. Abe has no DPGR since he does not own the property.

Ace Corporation incurred the following taxes for the current year: Ace Corporation's total tax liability is:

The DPAD is not allowed for AMT purposes.

Mayberry, Inc. engages in production activities that generate QPAI of $460,000 and taxable income (without taking into account the DPAD and NOL) of $600,000 in 2015. The company also has an NOL carryover to 2015 of $500,000 and qualified W-2 wages of $300,000. Calculate any DPAD.

The AMT exemption amount of $40,000 phases out entirely once a corporation's average gross receipts exceeds $310,000.

A small corporation with unused minimum tax credits may use what percentage of regular tax as a minimum credit in 2015?

If QPAI cannot be used in any one year due to the TI limitation, it can be carried over for 3 years.

Which entity is subject to the ACE provisions?

Gerbil Corporation was formed in 2005. If in 2015, it has average gross receipts of under $7.5 million, the company cannot be subject to the AMT.

Once a small corporation for AMT purposes, always a small corporation.

What amount of accumulated earnings of a service type corporation is considered within the reasonable needs of a business without the corporation having to show a bona fide business reason for the accumulation?

In 2015, May Corporation (a calendar year taxpayer) had the following transactions: For 2015, May Corporation's AMTI is:

Reasonable needs for purposes of the accumulated earnings tax do not include loans to shareholders.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Earnings Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, Operation, and Basis

Partnerships: Distributions, Transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Taxes on the Financial Statements

Exempt Entities

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Exam 3: Corporations: Special Situations

A taxpayer who prepares and sells Mexican food at several of its restaurant locations can qualify for DPAD as to the receipts only from take-out orders and home-delivery sales.

Sweet Corporation, a new corporation, has gross receipts of $4.9 million, $6.9 million, and $8.6 million in 2013, 2014, and 2015, respectively. Is this corporation a small corporation with respect to the AMT in years 2013, 2014, 2015, and 2016?

One of the components of DPGR is qualified production property (QPP). The QPP must be manufactured, produced, grown, or extracted entirely within the U.S.

The domestic production activities deduction is limited to corporations.

Which of the following items will be an addition to AMTI in arriving at ACE?

Which statement is false?

Which of the following would not be a positive tax preference item in 2015?

Harvey, a real estate developer, pays Abe, a general contractor, to construct an office building. Abe has no DPGR since he does not own the property.

Ace Corporation incurred the following taxes for the current year: Ace Corporation's total tax liability is:

The DPAD is not allowed for AMT purposes.

Mayberry, Inc. engages in production activities that generate QPAI of $460,000 and taxable income (without taking into account the DPAD and NOL) of $600,000 in 2015. The company also has an NOL carryover to 2015 of $500,000 and qualified W-2 wages of $300,000. Calculate any DPAD.

The AMT exemption amount of $40,000 phases out entirely once a corporation's average gross receipts exceeds $310,000.

A small corporation with unused minimum tax credits may use what percentage of regular tax as a minimum credit in 2015?

If QPAI cannot be used in any one year due to the TI limitation, it can be carried over for 3 years.

​Which entity is subject to the ACE provisions?

Gerbil Corporation was formed in 2005. If in 2015, it has average gross receipts of under $7.5 million, the company cannot be subject to the AMT.

Once a small corporation for AMT purposes, always a small corporation.

What amount of accumulated earnings of a service type corporation is considered within the reasonable needs of a business without the corporation having to show a bona fide business reason for the accumulation?

In 2015, May Corporation (a calendar year taxpayer) had the following transactions: For 2015, May Corporation's AMTI is:

Reasonable needs for purposes of the accumulated earnings tax do not include loans to shareholders.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Organization and Capital Structure

Corporations: Earnings Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, Operation, and Basis

Partnerships: Distributions, Transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Taxes on the Financial Statements

Exempt Entities

Multistate Corporate Taxation

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Which entity is subject to the ACE provisions?