Business Taxation Flashcards
6 cards from real CTA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Business Taxation flashcards as text
Which tax form does a C corporation use to file its federal income tax return?
Answer: Form 1120
C corporations file their federal income tax return using Form 1120.
What is the current flat federal corporate income tax rate under the Tax Cuts and Jobs Act?
Answer: 21%
The Tax Cuts and Jobs Act of 2017 established a flat 21% federal corporate income tax rate.
A partnership files which informational return with the IRS?
Answer: Form 1065
Partnerships file Form 1065, an informational return that reports income, deductions, and each partner's distributive share.
Which of the following is a key characteristic of an S corporation?
Answer: Income passes through to shareholders' personal returns
S corporations are pass-through entities where income and losses flow through to shareholders' individual tax returns.
Under the qualified business income (QBI) deduction, eligible pass-through businesses may deduct up to what percentage of QBI?
Answer: 20%
IRC Section 199A allows eligible taxpayers a deduction of up to 20% of qualified business income from pass-through entities.
Which depreciation method allows businesses to immediately expense the full cost of qualifying assets in the year of acquisition?
Answer: Bonus depreciation (Section 168(k))
Section 168(k) bonus depreciation allows immediate expensing of the full cost of qualifying property in the placed-in-service year.