Reference no: EM132483621

Full Corporation, a cash method, calendar year C corporation, was formed and began business on November 1, 2018. Gull incurred the following expenses during its first year of operations (November 1, 2018-December 21, 2018):

1. Expenses of temporary directors and organizational meetings $21,000
2. Fee paid to state of incorporation $3,000
3. Expenses for printing and sale of stock certificates $11,000
4. Legal services for drafting the corporate charter and bylaws (not paid until January 2019) $19,000

Question a. Assuming that Gull Corporation elects under §248 to expense and amortize organizational expenditures, what amount may be deducted in 2018?

Question b. Assume the same facts as above, except that the amount paid for the legal services was $28,000 (instead of $19,000). What amount may be deducted as organizational expenditures in 2018?