Deck 10

Question 1

Are Roth IRA contributions deductible?

Answer 1

Not deductible

Question 2

Medical insurance premiums qualify as:

Answer 2

Deductions from AGI

Question 3

Sales taxes and interest expense are examples of:

Answer 3

Deductions from AGI

Question 4

Examples of contributions that are not charitable?

Answer 4

Contributions for political campaigns

Question 5

Casualty and theft loss:

Answer 5

Loss starts at the lesser of decrease in FMV or adjusted basis

Question 6

A corporation’s capital loss carryback or carryover is always treated as:

Answer 6

A short term capital loss

Question 7

Losses resulting from the sale, exchange or worthlessness of Section 1244 qualifying stock are treated as:

Answer 7

Ordinary losses up to $50,000 in any tax year; only available to original owners of the stock

Question 8

What amount of distributions is classified as dividend income to shareholders?

Answer 8

Accumulated E&P and Current E%P

Question 9

Net capital losses:

Answer 9

Carried back 3 and forward 5

Question 10

Net operating losses::

Answer 10

Carried back 20 years and forward 2

Question 11

Limit for charitable contributions for a C corporation

Answer 11

10% of its taxable income after adding back the dividends received deduction

Question 12

Dividends Received Deduction (DRD) =

Answer 12

70% of dividends received; limited to 70% of DRD modified taxable income

Question 13

If the prior omission was nonfraudulent, the statute of limitations…

Answer 13

Cannot be reopened after it has expired

Question 14

Tax-free (Type B) reorganization:

Answer 14

The acquisition of a controlling (usually 80%) interest by one corporation in the stock of another corporation solely for stock

Question 15

The costs of organizing the corporation:

Answer 15

Are expensable (subject to the $5,000 limitation) and amortizable; the costs of selling stock are not

Question 16

A significant advantage of consolidate tax returns is:

Answer 16

The ability to offset gains and losses among group members as if they were a single taxpayer.

Question 17

The statute of limitations on a corporations tax return begins on what date?

Answer 17

March 16

Question 18

Taxable dividend income is paid out of the corporation’s:

Answer 18

Current and accumulated earnings and profits; if there is a deficit, only current E&P are available

Question 19

Filing fees, professional fees, and other expenditures incurred in connection with a liquidation and dissolution are:

Answer 19

Deductible in full by the dissolved corporation

Question 20

Organizational costs are amortized over a minimum period of:

Answer 20

15 years (180 months); a $5000 deduction is allowed in year 1