CHAPTER2-LECTURE1 - CHAPTER 2 CORPORATIONS INTRODUCTION OPERATING RULES AND RELATED CORPORATIONS I VARIOUS BUSINESS FORMS(1 SOLE PROPRIETORSHIP(NOT

CHAPTER2-LECTURE1 - CHAPTER 2 CORPORATIONS INTRODUCTION...

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CHAPTER 2 CORPORATIONS: INTRODUCTION, OPERATING RULES, AND RELATED CORPORATIONS I. VARIOUS BUSINESS FORMS (1) SOLE PROPRIETORSHIP (NOT SEPARATE TAXABLE ENTITY) (FORM 1040 (SCHEDULE C)) (COVERED IN ACCOUNTING 4301) (2) PARTNERSHIPS (NOT TAXABLE ENTITY) (FORM 1065 (AND SCHEDULE K-1)) (CHAPTERS 10 AND 11) (3) TRUSTS AND ESTATES (TAXABLE TO WHOM RECEIVES THE INCOME (IE. ENTITY OR BENEFICIARY) (FORM 1041 (AND SCHEDULE K-1)) (COVERED IN ACCOUNTING 4322) (4) S CORPORATIONS (TAXED (TREATED) SIMILAR TO PARTNERSHIPS) (FORM 1120S (AND SCHEDULE K-1)) (CHAPTER 12)
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(5) REGULAR CORPORATIONS (C CORPORATIONS) (TAXABLE ENTITY; DIVIDENDS DISTRIBUTED TO SHAREHOLDERS ARE TAXABLE TO SHAREHOLDERS. THUS, DOUBLE TAXATION ) (FORM 1120 (OR FORM 1120-A PRIOR TO JANUARY 1, 2007)) (CHAPTERS 2 THROUGH 7) II. WHAT IS A CORPORATION? (STATE LAW DOES NOT GOVERN) (1) DISREGARD OF CORPORATE ENTITY (WHEN THERE IS A LACK OF SUBSTANCE FOR THE CORPORATION OR THERE IS LITTLE OR NO BUSINESS ACTIVITY) (2) ASSIGNMENT OF INCOME DOCTRINE (CANNOT ASSIGN INCOME EARNED FOR SERVICE RENDERED TO SOMEONE ELSE (OR SOME OTHER ENTITY)) (3) ASSOCIATIONS (TAXED AS C (REGULAR) CORPORATION)
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SIX CORPORATE CHARACTERISTICS (1) ASSOCIATES (2) OBJECTIVE TO CARRY ON BUSINESS AND DIVIDE GAINS THEREFROM (3) CONTINUITY OF LIFE (4) CENTRALIZED MANAGEMENT (5) LIMITED LIABILITY (6)
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