Question 1

An S corporation's separately stated items generally are identical to those separately stated by
_________________________.

Accepted Answer

The answer of An S corporation's separately stated items generally...

Question 2

What statement is correct with respect to an S corporation?

Accepted Answer

A)  There are now more LLCs than S corporations. 
B)  S corporation status allows shareholders immediately to realize tax benefits from corporate losses. 
C)  An S corporation is prohibited from being a member of an affiliated group. 
D)  An LLP may own stock in an S corporation. 
E)  None of the above statements is correct. 
A)  There are now more LLCs than S corporations. 
B)  S corporation status allows shareholders immediately to realize tax benefits from corporate losses. 
C)  An S corporation is prohibited from being a member of an affiliated group. 
D)  An LLP may own stock in an S corporation. 
E)  None of the above statements is correct.

Question 3

Any losses that are suspended under the at-risk rules are carried forward and are available during an S corporation's post­termination period.

Accepted Answer

A) True 
 B)False

Question 4

The termination of an S election occurs on the day after a corporation ceases to be a qualifying S corporation.

Accepted Answer

A) True 
 B)False

Question 5

Which of these tax provisions does not apply to an S corporation?

Accepted Answer

A)  Section 1244 stock. 
B)  "Partial liquidation" stock redemption. 
C)  Tax­free "A" reorganization. 
D)  Section 1202 capital gain exclusion. 
A)  Section 1244 stock. 
B)  "Partial liquidation" stock redemption. 
C)  Tax­free "A" reorganization. 
D)  Section 1202 capital gain exclusion.

Question 6

An estate may be a shareholder of an S corporation.

Accepted Answer

A) True 
 B)False

Question 7

Which could constitute a second class of stock?

Accepted Answer

A)  Treasury stock. 
B)  Phantom stock. 
C)  Unexercised stock options. 
D)  Warrants. 
E)  None of the above. 
A)  Treasury stock. 
B)  Phantom stock. 
C)  Unexercised stock options. 
D)  Warrants. 
E)  None of the above.

Question 8

Depreciation recapture income is a computed amount.

Accepted Answer

The answer of Depreciation recapture income is a computed amount....

Question 9

The Schedule M-3 is the same for a C corporation and an S corporation.

Accepted Answer

A) True 
 B)False

Question 10

An S corporation does not recognize a loss when distributing assets that are worth less than their basis.

Accepted Answer

A) True 
 B)False

Question 11

Several individuals acquire assets on behalf of Skip Corporation on May 28, 2014, purchased assets on June 3, 2014, and began business on June 11, 2014. They subscribe to shares of stock, file articles of incorporation for Skip, and become shareholders on June 21, 2014. The S election must be filed no later than 2 1/2 months after:

Accepted Answer

A)  May 28, 2014. 
B)  June 3, 2014. 
C)  June 11, 2014. 
D)  June 21, 2014. 
E)  December 31, 2014. 
A)  May 28, 2014. 
B)  June 3, 2014. 
C)  June 11, 2014. 
D)  June 21, 2014. 
E)  December 31, 2014.

Question 12

Which item is not included in an S corporation's nonseparately computed income?

Accepted Answer

A)  Net sales. 
B)  Cost of goods sold. 
C)  Dividends received. 
D)  Depreciation recapture. 
A)  Net sales. 
B)  Cost of goods sold. 
C)  Dividends received. 
D)  Depreciation recapture.

Question 13

When loss assets are distributed by an S corporation, a shareholder's basis is equal to the asset's fair market value.

Accepted Answer

A) True 
 B)False

Question 14

Most IRAs cannot own stock in an S corporation.

Accepted Answer

A) True 
 B)False

Question 15

There is no need formally to elect to treat members as a single shareholder.

Accepted Answer

The answer of There is no need formally to elect...

Question 16

Where the S corporation rules are silent, C corporation provisions apply.

Accepted Answer

A) True 
 B)False

Question 17

Explain how the domestic production activities deduction is used in computing income amounts for an S corporation.

Accepted Answer

The § 199 deduction is determined at the

Question 18

Post-termination distributions by a former S corporation that are charged against do not get tax-free treatment.

Accepted Answer

The answer of Post-termination distributions by a former S corporation...

Question 19

Match the term with the proper response. There may be more than one responses for each term.

-AAA

Accepted Answer

A) 	Gross receipts from royalties, passive rents, dividends, interest, etc. 
B) 	Penalty tax to stop an S corporation from avoiding the corporate tax on disposition of appreciated property. 
C) 	Cumulative total of undistributed non-separately and separately stated items. 
D) 	Tax-free distribution. 
E) 	Taxed as dividend income. 
A) 	Gross receipts from royalties, passive rents, dividends, interest, etc. 
B) 	Penalty tax to stop an S corporation from avoiding the corporate tax on disposition of appreciated property. 
C) 	Cumulative total of undistributed non-separately and separately stated items. 
D) 	Tax-free distribution. 
E) 	Taxed as dividend income.

Question 20

Voting common stock and voting preferred stock (with a preference on dividends) would be treated as
____________________ class(es) of stock.

Accepted Answer

The answer of Voting common stock and voting preferred stock...

An S corporation's separately stated items generally are identical to those separately stated by _________________________.

What statement is correct with respect to an S corporation?

Any losses that are suspended under the at-risk rules are carried forward and are available during an S corporation's posttermination period.

The termination of an S election occurs on the day after a corporation ceases to be a qualifying S corporation.

Which of these tax provisions does not apply to an S corporation?

An estate may be a shareholder of an S corporation.

Which could constitute a second class of stock?

Depreciation recapture income is a computed amount.

The Schedule M-3 is the same for a C corporation and an S corporation.

An S corporation does not recognize a loss when distributing assets that are worth less than their basis.

Which item is not included in an S corporation's nonseparately computed income?

When loss assets are distributed by an S corporation, a shareholder's basis is equal to the asset's fair market value.

Most IRAs cannot own stock in an S corporation.

There is no need formally to elect to treat members as a single shareholder.

Where the S corporation rules are silent, C corporation provisions apply.

Explain how the domestic production activities deduction is used in computing income amounts for an S corporation.

Post-termination distributions by a former S corporation that are charged against do not get tax-free treatment.

Match the term with the proper response. There may be more than one responses for each term. -AAA

Voting common stock and voting preferred stock (with a preference on dividends) would be treated as ____________________ class(es) of stock.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

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

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 12: S: Corporations

An S corporation's separately stated items generally are identical to those separately stated by _________________________.

What statement is correct with respect to an S corporation?

Any losses that are suspended under the at-risk rules are carried forward and are available during an S corporation's post­termination period.

The termination of an S election occurs on the day after a corporation ceases to be a qualifying S corporation.

Which of these tax provisions does not apply to an S corporation?

An estate may be a shareholder of an S corporation.

Which could constitute a second class of stock?

Depreciation recapture income is a computed amount.

The Schedule M-3 is the same for a C corporation and an S corporation.

An S corporation does not recognize a loss when distributing assets that are worth less than their basis.

Which item is not included in an S corporation's nonseparately computed income?

When loss assets are distributed by an S corporation, a shareholder's basis is equal to the asset's fair market value.

Most IRAs cannot own stock in an S corporation.

There is no need formally to elect to treat members as a single shareholder.

Where the S corporation rules are silent, C corporation provisions apply.

Explain how the domestic production activities deduction is used in computing income amounts for an S corporation.

Post-termination distributions by a former S corporation that are charged against do not get tax-free treatment.

Match the term with the proper response. There may be more than one responses for each term. -AAA

Voting common stock and voting preferred stock (with a preference on dividends) would be treated as ____________________ class(es) of stock.

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

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

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

Any losses that are suspended under the at-risk rules are carried forward and are available during an S corporation's posttermination period.