A personal holding company (PHC) has a regular income of $100,000, dividend-received deductions of $10,000 and a net operating loss of $20,000. The PHC pays $5000 in foreign income taxes and $15,000 in dividends. What is its tax liability if the PHC has a tax rate of 20%? >$22,000 >$90,000 >$110,000 >$18,000

What is a tax consequence of reorganization for the acquiring corporation? >The holding period for property received starts the day after the exchange >No gain or loss is reorganized when it receives cash or other boot property in exchange for its stock or debt obligations. >The basis of the non-cash property received is recorded at its fair market value >No gain or loss is recognized when it transfer appreciated or depreciated noncash boot property to the target corporation.

What is a strength of a spin-off divisive reorganization? >It can be used to resolve the dispute between two distinct shareholder groups. >It can be used to separate distinct operations when there is little goodwill >It can be used to prevent a distinct bootstrap acquisition >It can be used to minimize the risk associated with distinct operations.

A corporation reports taxable income of $400,000 for the year it placed equipment in service. The equipment cost $350,000. The corporation expensed the equipment under the Sec 179. For earnings and profit (E&P) purposes, the company only expensed $50,000 for the equipment. What should be the companys current E&P after accounting for the equipment? >$400,000 >$700,000 >$750,000 >$350,000