C11-Chp-02-1A-Corp-Tax-Law-2011

C11-Chp-02-1A-Corp-Tax-Law-2011 - Chapter 2A. Corp. Tax Law...

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Chapter 2A. Corp. Tax Law Howard Godfrey, Ph.D., CPA Professor of Accounting Copyright © 2011 Edited December 28, 2010 C11-Chp-02-1A-Corp-Tax-Law-2011
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A student should understand: 1. Various business forms – corp. etc. [Pg. 2] 2. Corporate tax (compare w/ individuals). [Pg. 8] 4. Cap. gains (losses). Deprec. recap. [Page 12] 5. Passive Losses [Page 12] 6. Charitable contributions. [Page 14] 7. Domestic Production Activities [Page 16] 8. Net operating losses. [Page 17] 9. Dividends received deduction. [Page 18] 11. Related Corporations [Page 22] 12.Filing requirements, payments [23] 13.Tax and book income. Acct. for Tax [Page 25] 14.Tax planning. Transactions w/ Owner. [Pg 36]
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1. Compare Business Forms. [Page 2-2] Sec. 1, 1(h), 11, 1201, 63
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Lecture Outline A corporation is a separate taxpaying entity. This chapter discusses the rules for determining a corp's taxable income and tax liability. It also discusses how to file a corporate tax return. The corporations discussed in this chapter are regular corporations or C corporations. Corporations that are not classified as domestic -- are foreign corporations. Foreign corps are taxed somewhat like domestic corporations if they conduct a trade or business in the United States.
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Sue owns 100% of Sue Corp. (C Corp), 50% of SueCorpS (S). She is also a 50% partner in the Sue Partnership. She receives a salary from the two corporations. Her beginning tax basis is $65,000 for each entity. Sue Corp. SueCorpS. Sue Ptship Answer Revenue $100,000 $100,000 $100,000 Salary to Sue 40,000 40,000 Other Expenses 10,000 50,000 30,000 Taxable income 50,000 Taxable income 10,000 Taxable income 70,000 Total dividends paid 6,000 Total dividends paid $4,000 Total distribution $10,000 Sue's gross income from these three entities?
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Sue owns 100% of Sue Corp. (C Corp), 50% of SueCorpS (S). She is also a 50% partner in the Sue Partnership. She receives a salary from the two corporations. Her beginning tax basis is $65,000 for each entity. Sue Corp. SueCorpS. Sue Ptship Answer Revenue $100,000 $100,000 $100,000 Salary to Sue 40,000 40,000 $80,000 Other Expenses 10,000 50,000 30,000 Taxable income 50,000 Taxable income 10,000 $5,000 Taxable income 70,000 $35,000 Total dividends paid 6,000 $6,000 Total dividends paid $4,000 Total distribution $10,000 Sue's gross income from these three entities? $126,000
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FICA Rates for 2010 A combined employee-employer social security tax rate of 15.30% applies in 2010. Employers and employees are each liable for 6.20% of old age security and disability insurance tax or a total of 12.40% of the first $106,800 of wages in 2010. Employers and employees also are each
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C11-Chp-02-1A-Corp-Tax-Law-2011 - Chapter 2A. Corp. Tax Law...

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