S Corp Operations Flashcards
T/F S Corps are subject to the Corporate Income Tax?
F
T/F S Corps are subject to the Accumulated Earnings Tax?
F
T/F S Corps are subject to the Personal Holding Company Tax?
F
T/F Ordinary items of business income and deductions are separately stated?
F. Distributive share passed through to each of the partners
T/F Separately stated items include Section 1231 G/L?
T
T/F Separately stated items include Net STCG/L?
T
T/F Separately stated items include NLTCG/L?
T
T/F Separately stated items include Dividends?
T
T/F Separately stated items include Charitable Contributions?
T
T/F Separately stated items include Taxes Paid to Foreign Country or US Possession?
T
T/F Separately stated items include Tax-Exempt interest and related expense?
T
T/F Separately stated items include Investment Income and Related Expense?
T
T/F Separately stated items include Amounts previously deducted (bad debts)?
T
T/F Separately stated items include Real Estate Activities?
T
T/F Separately stated items include Section 179 Deductions?
T
T/F Separately stated items include Credits?
T
T/F Separately stated items include Other deductions whose separate treatment could affect a SH liability?
T
T/F Separately stated items include Taxes Paid to Foreign Country or US Possession?
T
T/F Amount of each item distributed to shareholders on a per-share then a per-day basis?
F, Allocated on a per-day then per- share basis
T/F Taxpayer’s holding period of S Corp stock includes day of acquisition?
F
T/F Taxpayer’s holding period of S Corp stock includes day of disposition?
T
T/F C Corporations’ NOL carryovers will transfer to the S Corporation?
F
T/F C Corp capital loss carryovers will transfer to the S Corp?
T. Flows through to shareholders
Order in which S Corp Distributions are funded?
1) Accumulated Adjustments Account (AAA)
2) Other Adjustments Account (OAA)
3) Stock Basis
What does AAA represent
Undistributed Gross Income less Expenses
T/F OAA is composed of adjustments made for tax-exempt income and related deductions?
T
Amount deductible according to S Corp At-Risk rules?
(1) Money/basis of property contributed to partnership
(2) Amounts lent to the corporation for which the SH has personal liability or has pledged collateral.
(3) Does NOT include S Corp debts to 3P even if SH guarantees (some exceptions)
T/F AAA can be reduced below zero?
T, but only by operations, not by distributions.
