Assume the following S corporations, gross receipts, passive investment income, and corporate E&P. Will any of these corporations have its S election terminated due to excessive passive income? If so, in what year? All became S corporations at the beginning of year 1. (Leave no answer blank. Select "NA" if no effect.)

Does James have income, gain or loss on the transaction in which he receives stock in TOBY, INC.?  Indicate the amount of any income, gain, or loss. What is James’s basis in TOBY, INC. stock? Does Jenna have income, gain, or loss on the transaction in which she receives stock in TOBY, INC.? Indicate the amount of any income, gain, or loss.

Robert and Charles are trying to decide what form of business to form for their new company. They ask you the following question: Which of the following transactions would be considered by the IRS to be a taxable sale of assets? Changing the form of business from: a partnership to an LLC. a corporation to an LLC. All of the above. an LLC to a corporation.

Which of the following statements is true related to the conversion of a regular corporation to a limited liability company taxed as a partnership? A. In the conversion of a C corporation to an LLC taxed as a partnership, the transfer of appreciated assets from the liquidating corporations is not taxed at the corporate level. B. The corporation can contribute it's assets and liabilities into the new LLC in exchange for ownership interests. The corporation then distributes the LLC interests to it's shareholders in liquidation of the shareholders corporate stock. C. If the corporation distributes it's assets and liabilities to it's shareholders in liquidation of the new corporation, the shareholders are restricted from contributing these assets into the new partnership. D. The existence of substantially appreciated intangibles and goodwill with little or no tax basis has no consequences when converting a C corporation to an LLC

18. Current Attempt in Progress         Taxable income of a corporation differs from pretax financial income because of   PermanentDifferences TemporaryDifferences Yes No Yes Yes   No No No Yes

Discuss planning opportunities with organizing a corporation. Instructions Original Post Prompt: Sarah incorporates her small business but does not transfer the machinery and equipment the business uses to the corporation. Subsequently, the machinery and equipment are leased to the corporation for an annual rent. What tax reasons might Sarah have for not transferring the machinery and equipment to the corporation when the business was incorporated?

All resident corporations (except tax-exempt Crown corporations and registered charities) have to file a corporation income tax (T2) return every tax year even if there is no tax payable. True False

An S corporation election terminates automatically in any of the following cases except: Select one: O a. The corporation has more than 100 shareholders. O b. The corporation has a partnership as a shareholder. O C. The election is revoked. O d. The corporation has an estate as a shareholder.

Which of the following statements is false about the taxation benefits of incorporation?   Incorporation is always the best business organization for tax purposes at the federal level.   Federal tax reform has removed some of the tax benefits of incorporation.   Federal tax reform has changed the taxation of businesses, making all types of businesses have similar tax rules.   Shareholders still benefit from delayed taxation because of incorporation.   Tax reform has changed the tax benefits of incorporation.

A corporation that transfers restricted stock to an employee as compensation may deduct the stock's fair market value in the year of transfer even if the employee doesn't recognize the value as gross income in the year of transfer. T/F also explain the reason, thanks.