Deck 36 Flashcards
Purpose of an operating agreement for an LLC?
Designed to forestall and resolve disputes among the owners
LLCs are taxed as what kind of entity?
Partnership
Unemployment tax payable under FUTA is:
Tax deductible employer’s expense
Apparent authority of a partner to bind a partnership in dealing with third parties will be:
Effectively limited by a formal resolution of the partners of which third parties are aware
Articles of incorporation must include:
Name and address of registered agent, name of corporation, name and address of incorporators, and number of shares authorized
When a bank accepts a check, all previous parties on the check are:
Discharged from liability
Debt holders do not have what in a corporation?
Ownership interest (common shareholders do)
Example of a non-fundable credit:
Retirement savings contribution credit
A reorganization is tax-free to:
All corporations and shareholders
What kind of losses are not deductible?
personal losses
A revocation is only effective when it is:
Received
Firm offer only applies to the sale of:
Goods
A taxpayer may file a claim for refund the later of:
3 years from the original due date or 2 years from the date the tax was paid
What amount of ordinary income should a partner report on his current year income tax return from the sale of his partnership interest?
1/3 of unrealized receivables
Gain recognized when buying shares with CASH for stock?
No gain
Student loan interest is what kind of deduction?
Deduction for AGI
What kind of deduction is used for mortgage interest?
Itemized deduction
A contribution is deductible for an accrual basis corporation if it meets two rules:
1) It was authorized before the end of the year; and 2) It was paid by the 15th day of the 3rd month after the end of the taxable year
There is no gain or loss recognized when a partner contributes property to a partner in exchange for:
A partnership interest
How does paying boot effect the basis?
Increases the basis
Examples of separately stated items:
Charitable contributions, dividend income, and net short-term capital losses
Example of an item that is not allowed as itemized deduction for AMT purposes:
Miscellaneous itemized deductions
Contributions of short-term property are generally deductible at the lower of:
Cost or FMV
Non-seperatly stated items is synonymous with the term:
Ordinary income (ordinary business revenue and expenses)
To qualify for the section 179 expense, the property must be both:
Tangible property to be used in the trade or business and be unrelated
