C Corp

Question 1

Shareholder’s basis in stock calculation (C Corp)

Answer 1

“No G/L when exchanging property for CS if:
80% control AND
No receipt of boot (no cash/debt exchange)”

“Basis in CS:
Cash (amount contributed) +
Property (adjusted basis) +
Services performed (FMV)”

Question 2

Shareholders basis in stock when liability is surrendered

Answer 2

“Shareholder stock basis:
Adj basis
- Liabilities assumed
+ Recognized gain”

Question 3

Corporation’s basis in property calculation

Answer 3

“Corporation basis greater of:
Transferor’s basis +
Gain recognized OR
Liabilities in excess of basis”

Question 4

How to calculate charitable contributions deduction

Answer 4

Max 10% if AGI with a 5 year carryforward. No carrybacks or DRD included in calc

Question 5

How to calculate Dividend received deduction

Answer 5

Owned 45 days before & after
Dividend Income:
100% if 80%-100% (consolidate)
65% if 20%-79% (large invest)
50% if under 20% (small invest)

Use lesser of Dividend % or taxable income. If taxable income is negative then?

Question 6

How are startup costs expensed when forming a corporation?

Answer 6

Both: Expenses over 50,000 reduce the $5,000 $ for $
$5,000 expensed (election) + Excess amortized over 180 months”

Question 7

Required estimated corporate tax payments

Answer 7

Small Corporations either:
100% of current year tax
100% of prior year tax”

Large corporations (1,000,000+ income):
100% of current year tax