2. Paying dividend in excess or amng und Earnings and Profit0 3. A corporation will never recognize gain or loss on purchase or sale of its own shares. E4. A person contributing assets with built in gain can elect to recognize the gain and increase basis in the partnership. 5. Distributions to a partner in excess of his outside basis will rd to a negative number. % 6 in 2018 JK Partners distributed Accounts Receivable with a basis of-d-and a fair value of $100,00 to Joe and nothing to other partners. The $100,000 will be treated as income to the partnership and not only to Joe. 7. "use tax" is a form of sales tax paid on purchases on line from out of state sellers. 8. A corporation formed in Delaware will always file a Delaware income tax return and y Delaware income tax even if it does not transact any business in Delaware. uce his/her outside basis pa 9B&H Photo sells over $1.2 million in internet and catalog sales in Califormia. It has stores in New York Only. Based on its sales volume it will have a nexus in California and be required to pay California income tax on the sales there.- 10. Because of differences in different state income tax laws, some income may be taxable in two states and some income that is taxable for federal purposes will escape taxation in any state. 11. Salaries earned by US citizen who lives in works in a foreign country and taxed in that country are never taxed in United States. 12. Ifa US citizen buys items in a foreign country that were subject to VAT (value added tax) the VAT paid will create a foreign tax credit. 13. The income earned by a foreign corporation that is owned 100% by US parent will be fully taxed in the US 14. Life insurance included in an estate is included at the cash surrender value, the amount the person could have gotten if they cashed the policy prior to death. 15, Taxable gifts during life will decrease the amount that can be passed tax free on death. 16. In addition to inheritance tax, an estate must pay capital gain tax on the difference between basis and date of death value. 17. Income earned by an estate will be taxed to the beneficiary when distributed. Prior to distribution there is no tax. 18There is no limitation or maximum amount that can be deducted for gifts to g charity 19. Income earned by a trust and held in the trust will be taxed to the person who set up 20. A trust owned tax-free municipal bonds. The interest earned by the trust on the bonds and distributed to the beneficiary will be taxable trust income to the beneficiary the trust