In this course, students will learn tax treatment of forming, operating, basis determination, distributions, transfers of interests, and termination of various business forms including C Corporations, S Corporations, and Partnerships. Determining Earnings and Profits (E&P) calculation for corporations is covered along with required disclosures for Schedule M-3. Multijurisdictional tax issues are discussed. Tax exempt organizations are covered, which include unrelated business income. Federal wealth transfer tax of gifts and estates are discussed along with income tax rules on estate and trusts. Emphasis is placed on tax research and alternative tax treatments that affect economic decisions. This course is the third of three tax courses that prepare students for individual and business decisions relating to federal taxation and the Federal Tax Regulation Section of the Certified Public Accountant (CPA) Exam. Prerequisite: ACCT-236. (3 hours weekly)
Fees This course has fees totaling $30.00.
Instructor Dorothea Malloy CPA CGMA
Office DH 132
Overall Course Objectives
Upon completion of this course, the student will be able to:
1. Analyze and apply research results that involve the Internal Revenue Code, Income Tax Regulations, and federal court tax cases.
2. Analyze income tax rules when forming, operating, determining owner basis; distributions, transfers, and termination of various business forms including corporations and partnerships.
3. Compare federal income tax rules to different business forms.
4. Reconcile C Corporation financial income to taxable income using Schedule M-3.
5. Determine Corporate Earnings and Profits (E&P) balance.
6. Compare and contrast multijurisdictional tax issues.
7. Evaluate unrelated business income for tax exempt organizations.
8. Analyze federal wealth transfer taxes for gift and estate transfers.
9. Apply income tax rules to estates and trusts.
I. Tax Research of Various Sources for Primary Authority
II. C Corporations
a. Determination of taxable income/loss
b. Net operating losses
c. Entity/owner transactions, including contributions and distributions
III. S Corporations
a. Eligibility and election
b. Determination of ordinary income/loss and separately stated items
c. Basis of shareholder’s interest
d. Entity/owner transactions, including contributions and distributions
e. Built in gains
a. Determination of ordinary income/loss and separately stated items
b. Basis of partner’s interest and basis of assets contributed to the partnership
c. Partnership and partner elections
d. Transactions between a partner and the partnership
e. Treatment of partnership liabilities
f. Distribution of partnership assets
g. Ownership changes and liquidation and termination of partnership
V. Similarities and Distinctions in Tax Treatment among Business Entities
VI. C Corporation reconciliation of book income to taxable income
a. Disclosures under Schedule M-3
VII. C Corporation Earnings and Profits Determination
VIII. Impact of Multijurisdictional Tax Issues on Federal Taxation (Including Consideration of Local, State, and Multinational Tax Issues)
IX. Tax-Exempt Organizations
a. Types of organizations
b. Obtaining and maintaining tax exempt status
c. Unrelated business income
X. Estate and Gift Taxation
a. Transfers subject to the gift tax
b. Annual exclusion and gift tax deductions
c. Determination of taxable estate
d. Marital deduction e. Unified credit
XI. Trusts and Estates
a. Types of trusts
b. Income and deductions
c. Determination of beneficiary’s share of taxable income
The course format includes but is not limited to the following:
This course does not have a face-to-face orientation. Orientation is provided during first week of online class.
Texts and Materials
Corporate Taxation 2014 by Pope ISBN 9780133443769
MyAccountingLab Online Course materials are required for this course. A student access kit is included in all books purchased from the HCC bookstore.
Semester exams will be given during the term. The final exam will be given during final exam week. Students are expected to take all exams at the Howard Community College Test Center on campus