Reference no: EM132380270
Question
1) Soccer Corporation has a $60,000 NOL in the current year. Soccer's taxable income in each of the previous three years was $15,000. Soccer expects its taxable income for next year to exceed $300,000. What issues should Soccer consider with respect to the use of the NOL?
2) Timex Corporation reports the following results for the current year:
Gross profits on sales $150,000
Dividends from less than 20% owned domestic corporation $30,000
Operating expenses $75,000
Charitable contributions in cash $13,000
What is Timex's charitable contribution deduction for the current year and is there a charitable contribution carryover available to the following year?
What is Timex's taxable income for the current year assuming qualifies production activities income is $30,000
3) Happy Corporation sells a truck for $18,000 to Marie, who owns 80% of Happy Corporation stock. The truck has a $22,000 adjusted basis on the sale date. Marie sells the truck to an unrelated party, Joseph for $32,000 two years later.
What is Happy's realized and recognized gain or loss on selling the truck?
What is Marie's realized and recognized gain or loss on selling the truck to Joseph?
4) You are the CPA who prepares the tax returns for Patrick, his wife, Susan and their two corporations. Patrick owns 100% of Shoe Corporation's stock and Shoe Corporation's current taxable income is $200,000. Susan owns 100% of Socks Corporation stock and Socks current year taxable income is $250,000. Patrick and Susan file a joint federal income tax return. What issues should Patrick and Susan consider with respect to the calculation of their tax return liabilities?