Questions from Federal Taxation

Q: Goose Corporation, a C corporation, incurs a net capital loss

Goose Corporation, a C corporation, incurs a net capital loss of $12,000 for 2018. I t also has ordinary income of $10,000 in 2018. Goose had net capital gains of $2,500 in 2014 and S5,000 in 2017. a....

Q: Hummingbird Corporation, a closely held C corporation that is not a

Hummingbird Corporation, a closely held C corporation that is not a PSC, has $40,000 of net active income, $15,000 of portfolio income, and a $45,000 loss from a passive activity. Compute Hummingbird'...

Q: Charlotte is a partner in, and sales manager for, CD

Charlotte is a partner in, and sales manager for, CD Partners, a domestic business that is not a "specified services" business. During the tax year, she receives guaranteed payments of $250,000 from C...

Q: Orion Corporation's board of directors decides to distribute property to its shareholders

Orion Corporation's board of directors decides to distribute property to its shareholders rather than pay a cash dividend. Why might Orion's board make this decision?

Q: Robert is the sole shareholder and CEO of ABC, Inc.,

Robert is the sole shareholder and CEO of ABC, Inc., an S corporation that is a qualified trade or business. During the current year, ABC has net income of$325,000 after deducting Robert's Sl 00,000 s...

Q: Maria and Javier are the equal partners in Maria, a partnership

Maria and Javier are the equal partners in Maria, a partnership that is a qualifying trade or business. In the current year, Maria had $350,000 of ordinary income after reporting $500,000 in guarantee...

Q: Thad, a single taxpayer, has taxable income before the QBI

Thad, a single taxpayer, has taxable income before the QBI deduction of $187,500. Thad, a CPA, operates an accounting practice as a single member LLC (which he reports as a sole proprietorship). Durin...

Q: Jason and Paula are married. They file a joint return for

Jason and Paula are married. They file a joint return for 2018 on which they report taxable income before the QBI deduction of $200,000. Jason operates a sole proprietorship, and Paula is a partner in...

Q: Henry, a freelance driver, finds passengers using various platforms such

Henry, a freelance driver, finds passengers using various platforms such as Uber and Grubhub. He is single and has no other sources of income. In 2018, Henry's net income from driving is S61,000. Con1...

Q: Fargo Corporation distributes property (basis of $260,000 and

Fargo Corporation distributes property (basis of $260,000 and fair market value of $310,000) to a shareholder. Fargo Corporation has sufficient E & P for its distributions. What are the tax consequenc...