Helmut and Sergei Own All the Stock of Zappo Corporation

question 41

Multiple Choice

Helmut and Sergei own all the stock of Zappo Corporation, a calendar-year domestic corporation. On January 30 of the current year, Sergei sells his entire interest in the Zappo stock to Nils. All three individuals are U.S. citizens. Can an S election be made for the current year?

• A)not for the current year but for the next year
• B)Yes, if Helmut and Nils agree to report all of the corporation's income for the entire year
• C)Yes, if Sergei will also join in the election with Helmut and Nils
• D)Yes, if Helmut and Nils agree to file a short-period return and Sergei also agrees to the return

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Definitions:

Lowest Terms

A fraction simplified to its smallest possible numerator and denominator without changing its value.

Fractions

Mathematical expressions representing divisions of whole numbers, often used to describe parts of a whole.

Mixed Numbers

Numbers consisting of an integer and a fraction combined, representing the sum of both parts.

Lowest Terms

The simplest form of a fraction, where the numerator and denominator are reduced to their smallest values.