Questions from Federal Taxation

Q: What is an inadvertent termination? What actions must the S corporation

What is an inadvertent termination? What actions must the S corporation and its shareholders take to correct an inadvertent termination?

Q: After an S corporation revokes or terminates its S election, how

After an S corporation revokes or terminates its S election, how long must the corporation wait to make a new election? What circumstances permit an early reelection?

Q: Lucia has a $20,000 basis in her limited partnership

Lucia has a $20,000 basis in her limited partnership interest before her retirement from the partnership. Her share of partnership assets have a $23,000 FMV, and the partnership has no Sec. 751 assets...

Q: What tax years can a newly created corporation that makes an S

What tax years can a newly created corporation that makes an S election adopt for its first tax year? If a fiscal year is permitted, does it require IRS approval?

Q: At the time Cable Corporation makes its S election, it elects

At the time Cable Corporation makes its S election, it elects to use a fiscal year based on a Sec. 444 election. What other requirements must Cable satisfy to continue to use its fiscal year election...

Q: What are Subchapter C earnings and profits (E&P)?

What are Subchapter C earnings and profits (E&P)? How does the existence of such E&P affect the S corporation’s ability to earn passive income?

Q: Explain the procedures for allocating an S corporation’s ordinary income or loss

Explain the procedures for allocating an S corporation’s ordinary income or loss to each of the shareholders. What special allocation elections are available?

Q: What limitations apply to the amount of loss pass-through an

What limitations apply to the amount of loss pass-through an S corporation shareholder can deduct? What happens to any losses exceeding this limitation? What happens to losses if the shareholder trans...

Q: What actions can an S corporation shareholder take before year-end

What actions can an S corporation shareholder take before year-end to increase the amount of the S corporation’s losses he or she can deduct in the year they are incurred?

Q: What is a post-termination transition period? What loss carryovers

What is a post-termination transition period? What loss carryovers can an S corporation shareholder deduct during this period?