Acct 553 final exam - Study guides, Class notes & Summaries

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...

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...

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...