Question
P and S Corporations form in Year 1, with S as Ps wholly-owned subsidiary. The corporations immediately elect to file consolidated tax returns. The group
P and S Corporations form in Year 1, with S as Ps wholly-owned subsidiary. The corporations immediately elect to file consolidated tax returns. The group reports the following results:
| Taxable Income | ||||
|---|---|---|---|---|
| Group Member | Year 1 | Year 2 | Year 3 | Year 4 |
| P | $9000 | $20000 | $21000 | $25000 |
| S | ($7800) | ($30000) | ($16000) | $2000 |
| Consolidated taxable income (Before NOL deduction) | $1200 | ($10000) | $5000 | $27000 |
In what year(s) can the group deduct the Year 2 consolidated NOL? Assume that Year 2 is a post-2017 year.
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Auditing And Assurance Services
Authors: Alvin A. Arens . Randal J. Elder . Mark S. Beasley
18th Global Edition
1292448989, 978-1292448985
