Entity Essentials
What form does a sole proprietor use to report income?
What is a Schedule C (Form 1040)
What accounting method reports income when earned and expenses when incurred?
What is Accrual method.
What IRS form is used to report the sale of business property?
What is : Form 4797
What form do C Corporations file?
What is Form 1120
What is the default tax classification for a single-member LLC?
What is Disregarded entity (taxed as a sole proprietorship)
Which entity type provides limited liability without double taxation?
What is a S Corporation or LLC (depending on election)
Which form do most small businesses use to file estimated tax payments?
What is Form 1040-ES?
What is the recovery period for office furniture under MACRS?
What is 7 years.
What is the flat corporate tax rate for C Corporations?
What is 21%
Which section of the code covers like-kind exchanges?
What is Section 1031
What form does a partnership file?
What is Form 1065
What is the maximum Section 179 deduction for 2025 (before phaseout)?
What is $1,220,000 (phaseout begins at $3,050,000)
Section 1245 recapture applies to what type of property?
What is Depreciable personal property.
What form do S Corporations file?
What is Form 1120-S
True or False — A partnership can have an S Corporation as a partner.
What is True
Name one advantage and one disadvantage of operating as a C Corporation.
What is limited liability / ability to raise capital; Disadvantage: double taxation.
True or False — A business can deduct fines and penalties paid to the government.
What is False.
What is the difference between Section 1231 and 1245 property?
What is : Section 1231 = business property; 1245 = depreciable personal property subject to recapture.
What form do S Corporations issue to shareholders to report income?
What is Schedule K-1 (Form 1120-S)
What type of corporation is subject to double taxation?
What is C Corporation
What form must be filed to elect S Corporation status?
What is Form 2553
What form is used to apply for an Employer Identification Number (EIN)?
What is Form SS-4
What is the depreciation method used for most tangible personal property under MACRS?
What is 200% declining balance method
What form must a corporation file to request an automatic six-month extension?
What is Form 7004
An LLC with two members elects to be taxed as a corporation and then as an S corporation. How is it treated for federal tax purposes?
What is, It is treated as an S Corporation after the election is accepted by the IRS.