C12-Chp-02-1A-Corp-Tax-Law-2012

C12-Chp-02-1A-Corp-Tax-Law-2012 - Chapter 2A. Corp. Tax Law...

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Chapter 2A. Corp. Tax Law Howard Godfrey, Ph.D., CPA Professor of Accounting Copyright © 2012 Edited January 14, 2012 C12-Chp-02-1A-Corp-Tax-Law-2012
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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. Recapture [Page 12] 5. Passive Losses [Page 14] 6. Charitable contributions. [Page 14] 7. Domestic Production Activities [Page 17] 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 24+] 14. Tax planning. Transactions w/ Owner. [Pg. 40]
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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), 100% of SueCorpS (S). She is also a 50% partner in the Sue Partnership. She receives a salary from the two corporations. Sue Corp. SueCorpS. Sue Ptship Answer Sue's Begin. Basis $65,000 $65,000 $65,000 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 Ordinary bus. Income 10,000 Taxable income 70,000 Total dividends paid 6,000 Total dividends paid $4,000 Total distribution $10,000 Sue's Ending Basis Sue's gross income from these three entities? Sections 61, 702, 705, 722,731, 1363, 1366, 1367, 1368
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Sue owns 100% of Sue Corp. (C Corp), 100% of SueCorpS (S). She is also a 50% partner in the Sue Partnership. She receives a salary from the two corporations. Sue Corp. SueCorpS. Sue Ptship Answer Sue's Begin. Basis $65,000 $65,000 $65,000 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 Ordinary bus. Income 10,000 $10,000 Taxable income 70,000 $35,000 Total dividends paid 6,000 $6,000 Total dividends paid $4,000 Total distribution $10,000 Sue's Ending Basis $65,000 $71,000 $95,000 Sue's gross income from these three entities? $131,000 Sections 61, 702, 705, 722,731, 1363, 1366, 1367, 1368
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7 FICA Rates for 2011 A combined employee-employer social security tax rate of 15.30% applies in 2011. Employers and employees are each
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C12-Chp-02-1A-Corp-Tax-Law-2012 - Chapter 2A. Corp. Tax Law...

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