Acct 553 - Study guides, Class notes & Summaries

S corporations are treated as partnerships under state property laws. - ANSWER False Liabilities affect the owner's basis differently in an S corporation than they do in a partnership. - ANSWER True Distributions of appreciated property by an S corporation are not taxable to the entity. - ANSWER False An S corporation cannot incur a tax liability at the corporation level. - ANSWER False Where the S corporation rules are silent, C corporation provisions apply. - ANSWER True A newl...

For Federal income tax purposes, a business entity with two or more owners may be conducted as a partnership, C corporation, S corporation, or limited liability company. - ANSWER True Daniel, who is single, estimates that the profits of his business for the current tax year will be $100,000. Since the highest tax rate (34%) applicable to corporate taxable income of $100,000 is greater than the highest tax rate (28%) applicable to individual taxable income of $100,000, the Federal income tax l...

ACCT 553 Final Exam (TCO E) For federal tax purposes, income attributable to the direct efforts of the tax payer, such as salary, is classified as: (TCO D) Which of the following is an example of a nontaxable like-kind exchange? (TCO H) Alex and Amy file a joint return for the 2012 tax year. Their adjusted gross income is $90,000. They had net investment income of $8,000. In 2012, they had the following interest expenses: • Personal credit card interest: $5,000 • Home mortgage interes...

ACCT 553 553Final Exam Study G

(TCO A) A taxpayer may litigate a tax dispute without first paying the tax in the: (TCO F) A business bad debt is deductible for tax purposes as a(n): (TCO I) Under the cash method of tax accounting, tax deductions are generally taken when: (TCO A) Which of the following constitutes tax evasion? (TCO C) Which of the following items is not subject to federal income tax? (TCO B) Sam owes Bob $8,000. Bob cancels (forgives) the debt. The cancellation is not a gift, and Sam is bankrupt. Which of...