LO.7 Red, Inc., a calendar year employer, has an accrued NQDC liability of $400,000 on December 31,
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LO.7 Red, Inc., a calendar year employer, has an accrued NQDC liability of $400,000 on December 31, 2010. During 2011, the company accrues another $70,000 of NQDC.
On February 12, 2012, the company pays the entire $470,000 to Otis, a cash basis employee.
a. What amount is considered to be deferred compensation?
b. What amount, if any, can the corporation deduct? When?
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Related Book For
South Western Federal Taxation 2013 Individual Income Taxes
ISBN: 9781133189558
36th Edition
Authors: William Hoffman, James E. Smith
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