CTA Business Taxation

Question 1

Which tax form does a C corporation use to file its federal income tax return?

Accepted Answer

Form 1120

Answer

C corporations file their federal income tax return using Form 1120.

Question 2

What is the current flat federal corporate income tax rate under the Tax Cuts and Jobs Act?

Accepted Answer

21%

Answer

The Tax Cuts and Jobs Act of 2017 established a flat 21% federal corporate income tax rate.

Question 3

A partnership files which informational return with the IRS?

Accepted Answer

Form 1065

Answer

Partnerships file Form 1065, an informational return that reports income, deductions, and each partner's distributive share.

Question 4

Which of the following is a key characteristic of an S corporation?

Accepted Answer

Income passes through to shareholders' personal returns

Answer

S corporations are pass-through entities where income and losses flow through to shareholders' individual tax returns.

Question 5

Under the qualified business income (QBI) deduction, eligible pass-through businesses may deduct up to what percentage of QBI?

Accepted Answer

20%

Answer

IRC Section 199A allows eligible taxpayers a deduction of up to 20% of qualified business income from pass-through entities.

CTA - Certified Tax Advisor Practice Test