7 Clampett, Incorporated, has been an S corporation since its inception On July 15, 2021, Clampett, Incorporated, distributed $78,000 to J.D. His basis in his Clampett, Incorporated, stock on January 1, 2021, was $39,000. For 2021, JD. was allocated $38,000 of ordinary income from Clampett, Incorporated, and no separately stated items. What is J.o's basis in his Clampett, Incorporated, stock after all transactions in 20217 Multiple Choice $77000 $39.000 SL000 (S38.000 None of the choices are correct

7 Clampett, Incorporated, has been an S corporation since its inception On July 15, 2021, Clampett, Incorporated, distributed $78,000 to J.D. His basis in his Clampett, Incorporated, stock on January 1, 2021, was $39,000. For 2021, JD. was allocated $38,000 of ordinary income from Clampett, Incorporated, and no separately stated items. What is J.o's basis in his Clampett, Incorporated, stock after all transactions in 20217 Multiple Choice $77000 $39.000 SL000 (S38.000 None of the choices are correct

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter20: Corporations And Partnerships

Section: Chapter Questions

Problem 4CPA

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Suppose that at the beginning of 2021 Jamaal's basis in his S corporation stock is $1,000 and he has a $10,000 debt basis associated with a $10,000 loan he made to the S corporation. In 2021, Jamaal's share of S corporation income is $4,000, and he received a $7.000 distribution from the S corporation. How much total income does Jamaal report in 2021 from these transactions? Multiple Choice $0 $4,000 $6,000 $7,000 None of the choices are correct.
Corporation A owns 70% of all classes of stock in Corporation B throughout 2021. Corporations A and B are Subchapter C corporations, and they are both domestic corporations. The Board of Directors of Corp. B authorized and paid $800,000 in cash dividends to Corporation A. Assume Corporation A qualifies for the Dividends Received Deduction. For tax purposes, how much does Corporation A recognize on Form 1120 for 2021, and how much is the Dividends Received Deduction for 2021? $800,000 recognized; $520,000 DRD$520,000 recognized; $280,000 DRD$280,000 recognized; $520,000 DRD$280,000 recognized; $800,000 DRDNone of the other choices are correct.
Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2021, it reported financial statement income after taxes of $1,529,880. Timpanogos provided the following information relating to its 2021 activities: $ 228,000 2,280,000 23,940 205,200 Life insurance proceeds as a result of CrO's death Revenue from sales (for both book and tax purposes) Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. Qualified charitable contributions Cost of goods sold for book and tax purposes Interest income on tax-exempt bonds Interest paid on loan obtained to purchase tax-exempt bonds Rental income payments received and earned in 2021 Rental income payments received in 2020 but earned in 2021 Rental income payments received in 2021 but not earned by year-end Tax depreciation Book Depreciation Net capita1 loss Federal income tax expense for books in 2021 342,000 45,600 51,300 17,100 11,400 34,200 62,700 28,500 47,880 353,400 Required: a.…
(4) Able is a shareholder in the QRS Corp. QRS has accumulated earnings and profits of $200,000, and current earnings and profits for the year 2019 equal to $300,000. What are the tax consequences to Able if QRS on December 15, 2019 declares a dividend equal to $250,000 payable in equal amounts of $50,000 to Able and the other four shareholders of QRS Corp. on December 27, 2019, if: (a) The amount declared is payable in the common stock of QRS? (b) Able and his fellow shareholders have the option of having the amount declared paid either in cash or QRS stock, and they all choose to receive additional stock? (c) Able can receive only additional QRS stock for his share of the amount declared, and the other four shareholders can receive only cash for their share?
Wineseller Corporation is owned by Mortimer Smith, its sole shareholder. Mortimer has a $20,000 basis in his Wineseller Corporation stock. Mortimer is in the 37% tax bracket. Wineseller Corporation is in the 21% tax bracket. Wineseller Corporation has the following balances as of December 31, 2021. Accumulated Earnings and Profits (AEP) ($600,000) Current Earnings and Profits $ 70,000 On December 31, 2021, Wineseller Corporation distributes $160,000 to Mortimer. What are the tax consequences to Mortimer from receiving this distribution from Wineseller Corporation?
Please do B,C,E,F
Clampett, Incorporated, converted to an S corporation on January 1, 2020. At that time, Clampett, Incorporated, had cash ($37,000), inventory (FMV $57,000, basis $24,000), accounts receivable (FMV $37,000, basis $37,000), and equipment (FMV $57,000, basis $77,000). In 2021, Clampett, Incorporated, sells its entire inventory for $57,000 (basis $24,000). Assume the corporate tax rate is 21 percent. Clampett, Incorporated's taxable income in 2021 would have been $1,000,000 if it had been a C corporation. How much built-in gains tax does Clampett, Incorporated, pay in 2021? Multiple Choice O O $9,870 $13,000 $2,730 $0 None of the choices are correct.
XYZ Corporation (an S corporation) is owned by Jane and Rebecca, who are each 50 percent shareholders. At the beginning of the year, Jane's basis in her XYZ stock was $54,000. XYZ reported the following tax information for 2022. Description Amount Sales revenue $ 716,000 Cost of goods sold (214,000) Long-term capital gain 22,000 Dividend income 26,000 Tax-exempt interest 17,000 Salary to owners (134,000) Employee wages (64,000) Depreciation expenses (10,600) Miscellaneous expenses (13,500) Overall net income $ 344,900 What amount of ordinary business income is allocated to Jane?Hint: you might want to work on question b) first. Identify all separated items, then the remaining will be ordinary business income What is the amount and character of separately stated items allocated to Jane? What is Jane's basis in her XYZ Corporation stock at the end of the year? Please avoid answers in image format thank you
Clampett, Incorporated, converted to an S corporation on January 1, 2020. At that time, Clampett, Incorporated, had cash ($40,000), inventory (FMV $60,000, basis $30,000), accounts receivable (FMV $40,000, basis $40,000), and equipment (FMV $60,000, basis $80,000). In 2021, Clampett, Incorporated, sells its entire inventory for $60,000 (basis $30,000). Assume the corporate tax rate is 21 percent and that Clampett, Incorporated, had a $20,000 net operating loss carryover from its prior C corporation years. How much built-in gains tax does Clampett, Incorporated, pay in 2021?
On January 1, 2023, Kinney, Inc., an S corporation, reports $4,000 of accumulated E & P and a balance of $10,000 in AAA. Kinney has twor shareholders, Erin and Frank, each of whom owns 500 shares of Kinney's stock. Kinney's nonseparately stated ordinary income for the year is $5,000. Kinney distributes $6,000 to each shareholder on July 1, and it distributes another $3,000 to each shareholder on December 21. How are the shareholders taxed on the distributions? Ignore the 20% QBI deduction. Round any division to five decimal places. If required, round final answers to the nearest dollar. Erin and Frank each report December 21 distribution. Assuming tax-free 1,000 dividend income for the July 1 distribution and s X each for the that the shareholders have sufficient basis in their stock, Erin and Frank each receive a X distribution from AAA.
X-Rays was organized in January 2019 as a corporation in the jurisdiction of Puerto Rico. During 2020, the taxable (natural) year, it obtained the following results under the accumulation method (“accrual”) ended on December 31, 2020. Income Services $ 425,000 Dividends 28,000 Total $ 453,000 Expenses Administration 275,000 Food 12,000 Entertainment 10,000 Depreciation 10,000 Data: Dividend income comes from a domestic corporation in Puerto Rico where X-Rays owns 12% of the common stock. The corporation generated a net operating loss of $ 200,000 in 2019. The depreciation claimed under GAAP is equal to the depreciation granted for taxes. Determine the net taxable income (loss) of X-Rays as of December 31, 2020 in Puerto Rico.
a. Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income.