Entity Taxation

Question 1

Shareholder’s basis in a nonliquidating property dividend received is

Answer 1

FMV - a gain can be taken for difference between FMV and Adjusted Basis

Question 2

The uniform capitalization rules require manufacturers to capitalize all:

Answer 2

Direct costs

Question 3

Requirements fora corp to elect to be treated as an S Corp (4)

Answer 3

1. 100 or fewer shareholders
2. One class of stock
3. Unanimous consent
4. Shareholders must be individuals/not businesses

Question 4

Expenses connected directly to the creation of a corporation

Answer 4

Organization expenses

Question 5

In what type of business entity is the entire ownership interest most freely transferable?

Answer 5

C Corporation

Question 6

Formula for total organization expense that may be deducted if under $50,000 total

Answer 6

$5,000 + (Total org costs - $5,000) * (#months / 180)

Question 7

Formula for total organization expenses that may be deducted if over $50,000 total

Answer 7

(Total org costs * ( # months / 180)

Question 8

A C Corp net operating loss is carried back and forward how many years?

Answer 8

Back 2 - Forward 20

Question 9

If own 20% of more a corp - how much is the allowed dividend received deduction?

Answer 9

80%

Question 10

Calculation for basis of property received in liquidating distribution?

Answer 10

Adjusted basis - cash received