R4 Flashcards
What is included on Schedule M1
Reconciliation of income (loss) per books to income (loss) per the tax return
What tax credit can a corporation not claim
Earned income credit
The personal holding company income test requires the company’s income forgiven taxable year to be at least:
Either more than 50% of the stock must be owned by five or fewer individual or at least 60% of the adjusted ordinary gross income must consist of certain investment income (NIRD)
NIRD
Net rent, interest that is taxable, royalties, dividends from an unrelated domestic corporation
When do partnerships terminate?
Cessetation of parternship activities, liquidation, or when business activities no longer continue in parternship form, or when there are fewer than 2 partners
When partners share of liabilities increases, partners basis
Increases by share of the increase (proportionally)
dividend received deduction
if own <20% can deduct up to 50% of the dividend it receives
if own >20%, can deduct up to 65%
rule for business gift deductions
max of $25 per recipient per year
form 1120 - charitable contributions deductions
lesser of: charitable contribution or 10% of taxable income before deducting charitable contributions, div rec’d, capital loss carryback
Div Rec Deduction
taxable income + div income amount - (div reduction % * div amount)
NOL Rules
can only offset 80% of taxable income (after 2020)
can be carried forward indefinitely but no carry back allowed
For purposes of the personal holding company rules who is considered “Family”
brothers, sisters, ancestors and lineal descendants.
former spouses, in laws, cousins are not
when is there no gain or loss recognized by a corporation (3 times)
- formation & issuance of common stock
- reacquisition- purchase of treasury stock
- resale-sale of treasury stock
