R4 - Consolidated Tax Returns

Question 1

Initial Requirements

Answer 1

• Be part of an affiliated group at some time during the year
• File a consent Form 1122

Question 2

Affiliated Group

Answer 2

• 80% or > of voting power; and

- 80% or > of value of all outstanding stock of each corp

Question 3

Consolidated Taxable Income Calc

Answer 3

1. Calc stand alone taxable income
2. Eliminations (I/C tranx)
3. Remove gains, losses, and deductions from each member to be determined at the consolidated level.
4. Add results for each member to arrive to group taxable income.
5. Adjust taxable income with items on #3 that are to be determined at the consolidated level.