Question : 21. S corporations pay taxes at a higher rate than do : 1313622

 

 

21. S corporations pay taxes at a higher rate than do regular corporations.

a. True

b. False

 

ANSWER:  False

RATIONALE:  S corporations do not generally pay taxes. Each shareholder reports his or her share of corporate income, deduction, gain, and loss on their own personal tax returns.

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-06 – LO:11-06

 

 

22. If a corporation’s status as an S corporation is involuntarily terminated in the middle of the tax year, the corporation must file as an S corporation for the first half of the tax year and a regular corporation for the second half of the tax year.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-06 – LO:11-06

 

 

23. As a general rule, the transfer of property to a corporation in exchange for stock does not result in a taxable transaction.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-07 – LO:11-07

 

 

24. The accumulated earnings tax will not be imposed on accumulations that can be shown to be necessary to meet the reasonable needs of the business.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-08 – LO:11-08

 

 

25. The accumulated earnings tax is designed to prevent shareholders from avoiding the individual income tax.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-08 – LO:11-08

 

 

26. A corporation may be found subject to both the accumulated earnings tax and the personal holding company tax in the same year.

a. True

b. False

 

ANSWER:  False

RATIONALE:  A corporation cannot be subject to both the accumulated earnings tax and the personal holding company tax in the same year.

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-08 – LO:11-08

 

 

27. The original due date for a tax return of a corporation with a calendar tax year-end falls before the original due date of a return for an individual taxpayer with the same tax year.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-05 – LO:11-05

 

 

28. The corporate alternative minimum tax rate is 28 percent.

a. True

b. False

 

ANSWER:  False

RATIONALE:  The corporate alternative minimum tax rate is 20 percent.

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-09 – LO:11-09

 

 

29. Corporations may be subject to the alternative minimum tax.

a. True

b. False

 

ANSWER:  True

POINTS:  1

QUESTION TYPE:  True / False

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-09 – LO:11-09

 

 

30. For 2014, what is the maximum tax rate for personal service corporations?

a. 25 percent

b. 28 percent

c. 34 percent

d. 35 percent

e. None of the above

 

ANSWER:  d

POINTS:  1

QUESTION TYPE:  Multiple Choice

HAS VARIABLES:  False

LEARNING OBJECTIVES:  ITF.WABG.15.LO:11-01 – LO:11-01