Exam 20: Corporations and Partnerships

The qualified business income deduction is determined at the partnership level and then passed through to each individual partner based on his or her partnership interest.

Which, if any, of the following rules relate only to the income taxation of C corporations?

For a partnership, guaranteed payments:

Darlene, a 30% shareholder in a calendar year S corporation, sells her stock on June 6, 2020.If the corporation has an operating loss for 2020, none of this loss can be claimed by Darlene because she was not a shareholder as of December 31, 2020.

As a separately stated item, the long-term capital losses of an S corporation pass through to its shareholders as short-term capital losses.

For income tax purposes, excess capital losses of individuals and corporations are treated in the same manner.

In a § 351 transfer to a controlled corporation, the corporation's basis for the property it receives is the shareholder's basis increased by any boot given by the corporation.

Under certain circumstances, an S corporation can have more than 100 shareholders.

If a corporation does not choose to amortize its organizational expenditures, such expenses never can be deducted.

The corporate form of business is never preferred from a tax perspective because of the inherent double taxation.

Using the legend provided, classify each statement accordingly. -Excess capital losses can be carried over indefinitely.

Using the legend provided, classify each statement accordingly. -A resident and citizen of Mexico can be a shareholder.

Like individuals, corporations can defer recognizing gain on like-kind exchanges.

Matching Using the legend provided, classify each statement accordingly. -A net short-term capital loss can be used to offset a net long-term capital gain.

Unlike regular dividends, constructive dividends need not be distributed to a corporation's shareholders on a pro rata basis.

Partners can carry over partnership losses that exceed the basis in their partnership interests.

Matching Using the legend provided, classify each statement accordingly. -Net long-term capital gains are subject to a preferential Federal income tax rate.

Two unrelated, calendar year C corporations report the following taxable income for 2020: Olive Corporation Magenta Corporation Taxable income \ 70,000 \ 90,000 Magenta Corporation is a qualified personal service corporation.Based on these facts, their corporate tax liability is:

The dividends received deduction can be limited to the dividends received deduction percentage multiplied by the taxable income of the receiving corporation.

In comparing regular C corporations with individuals, which of the following, if any, relates only to C corporations?