S-corp - CHAPTER 22 S CORPORATIONS TRUE\/FALSE 1 S corporations are treated as partnerships under state laws REF p 22-2 ANS F 2 Liabilities affect the

S-corp - CHAPTER 22 S CORPORATIONS TRUE/FALSE 1 S...

This preview shows page 1 - 4 out of 30 pages.

CHAPTER 22S CORPORATIONSTRUE/FALSE1.S corporations are treated as partnerships under state laws.ANS:FREF:p. 22-22.Liabilities affect the owner’s basis differently in an S corporation versus a partnership.
REF:p. 22-23.An S corporation cannot incur a tax liability at the corporation level.
REF:p. 22-24.Distributions of appreciated property by an S corporation are nottaxable to the entity.
REF:p. 22-35.Where the S corporation rules are silent, C corporation provisions apply.
REF:p. 22-36.More S corporation returns are filed than C corporation returns.
REF:p. 22-37.S corporation status allows shareholders to realize tax benefits from corporate losses immediately (assuming sufficient stock basis).
REF:p. 22-48.NOL carryovers for C years can be used in an S corporation year.
REF:p. 22-422-1
S Corporations22-29.Tax-exempt income at the S level loses its special tax treatment for the shareholder.
REF:p. 22-410.An estate may be a shareholder of an S corporation.
REF:p. 22-511.Most limited liability partnerships can own stock in an S corporation.
REF:p. 22-712.Most IRAs can own stock in an S corporation.
REF:p. 22-713.An S corporation can be a shareholder in another corporation.
REF:p. 22-714.If a resident alien shareholder moves outside the U.S., the S election is terminated.
REF:p. 22-715.An S election is made on Form 2550.
16.An S election made before becoming a corporation is valid the next 22-month tax year.
REF:p. 22-817.For a new corporation, a premature S election may not be effective.ANS:TREF:p. 22-818.Only 51% of the shareholders must consent to an S election.
19.Persons who were shareholders during any part of the year before the election date, but were not shareholders when the elction was made, also must consent to the election.
REF:p. 22-9
S Corporations22-320.The termination of an S election occurs on the day after a corporation ceases to be a small business corporation.
PTS:1REF:p. 22-1021.Passive investment income includes gains from the sale of securities.
REF:p. 22-1122.An S corporation may not amortize organization expenses.
REF:p. 22-1123.Tax-exempt income at the corporate level does flow through to the shareholders.ANS:TREF:Figure 22-124.The pro rata method assigns an equal amount of each of the S corporation items (e.g., LTCG) to each day of the year.ANS:TREF:p. 22-1325.An S corporation’s AAA cannot have a negative balance.
REF:p. 22-1726.An S corporation with earnings and profits can make a taxable dividend distribution by making a AAA bypass election.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture