Which of the following is subtracted from gross income to arrive at ordinary gross income (OGI)?

a.Capital losses

b.Section 1231 gains

c.Charitable contributions in excess of the amount deductible

d.Interest on tax refunds

e.None of the above

Which of the following is not considered an advantage of filing a consolidated tax return?

a.Losses of an affiliate may be offset against profits of other members of the group.

b.The election is binding and can be discontinued only with the Commissioner's permission.

c.dividends between group members are eliminated from income.

d.The basis in the stock of a subsidiary is increased by earnings and profits accumulated during consolidated return years.

e.All of the above are advantages of filing a consolidated tax return.

J files a separate return for 2020 with an operating loss of $5,000. For 2021, J purchases all of the outstanding stock of D corporation. J has taxable income of $3,000 in 2021, and D has income of $1,000. Under the "lonely parent rule," how much of J Corporation's loss carryover may be used on the consolidated tax return?(Disregard the 80% rule)

a.$4,000

b.$3,000

c.$2,000

d.$1,000

R, a first-year unaffiliated corporation, had taxable income for 2020 of $180,000. On January 1, 2021, the affiliated group consisting of Y and Z purchases all the stock of R and files a consolidated return for 2021 showing the following consolidated loss:

Y $(600,000)

Z 640,000

R (200,000)

Total $(160,000)

How much of the group's NOL is allocated to R?

a.$0

b.$20,000

c.$40,000

d.$160,000

e.$200,000