Corporation S is an S Corporation which elects S status effective January a of t
ID: 2447245 • Letter: C
Question
Corporation S is an S Corporation which elects S status effective January a of the tax year specified for the exam. Sole shareholder J has a basis of $400,000 in his stock. At the same time, S has $200,000 in accumulated earnings and profits. For the same tax year, S has the following items of income and expense: Gross Business Income $250,000 Dividend income $150,000 Business expenses $100,000 Expenses related to Dividends $50,000 a. J has non-separately stated income of $150,000 and dividend income of $100,000 b. J has non-separately stated income of $150,000 and dividend income of $83,333. c. Neither of the above.
please explain why you choose this answer. Thank you.
Explanation / Answer
The correct option is option - B.
Non-Separately stated income of $150,000 and dividend income of $83,333.