RGD Corporation was a C corporation from its inception in 2017 through 2022. However, it elected S corporation status effective January 1, 2023. RGD had $59,000 of earnings and profits at the end of 2022. RGD reported the following information for its 2023 tax year. Description Consulting revenue Salary to owners Employee wages Depreciation expense Municipal bond interest Interest income Dividend income Amount $ 108,000 (31,000) (34,500) (9,500) 15,000 51,000 34,000 $ 133,000 Overall net income What amount of excess net passive income tax is RGD liable for in 2023?

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Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.