What is Alleghany excess net passive income

Reference no: EM132752053

Question - a. Alleghany Corporation reports the following results:

Service income $80,000, Dividend income $60,000, Interest income $120,000,

Passive-income related expenses $40,000, Other expenses $100,000.

At the end of the year, Alleghany's C Corp E&P was $100,000. What is Alleghany's excess net passive income and excess net passive income tax?

b. Maine Corporation elects S status effective beginning year 2019. On January 1, 2019, Maine's assets were appraised as follows:

	Adjusted Basis	Fair Market Value
Cash	16,010	16,010
Accounts Receivable	0	55,400
Inventory	70,000	90,000
Investment in land	110,000	195,000
Building	220,000	275,000
Goodwill	0	93,000

In each of the following independent situations, calculate any built-in gains tax. C corporation taxable income would have been $100,000.

i. Crew collects $40,000 of the accounts receivable and sells 80% of the inventory for $99,000.

ii. Crew sells the land held for investment for $203,000.

iii. The building is sold for $270,000.

Reference no: EM132752053

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