ExpertMedium1 markMultiple Choice
CPA · Question 39 · Area 4: Entity Taxation
A C Corporation has taxable income of 0,000 before the charitable contribution deduction and dividends received deduction. It made cash charitable contributions of ,000. What is the allowable charitable contribution deduction?
A C Corporation has taxable income of 0,000 before the charitable contribution deduction and dividends received deduction. It made cash charitable contributions of ,000. What is the allowable charitable contribution deduction?
Answer options:
A.
,000
B.
0,000
C.
5,000
D.
0,000
How to approach this question
Limit = 10% of Taxable Income (before Charity, DRD, Cap Loss Carryback).
Full Answer
B.0,000✓ Correct
A C Corporation's charitable contribution deduction is limited to 10% of its taxable income computed without regard to the contribution deduction, DRD, or capital loss carrybacks.
Common mistakes
Using individual limits (50%/60%) for a corporation.
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