ParentCo, SubOne, and SubTwo Have Filed Consolidated Returns Since Year

question 86

Short Answer

ParentCo, SubOne, and SubTwo have filed consolidated returns since year 2. All of the entities were incorporated in Taxable income computations for the members include the following. None of the group members incurred any capita transactions during these years, nor did they make any charitable contributions. $$\begin{array} { l c c c c } \text { Year } & \begin{array} { c } \text { ParentCo's } \\\text { Taxable Income }\end{array} & \begin{array} { c } \text { SubOne's Taxable } \\\text { Income }\end{array} & \begin{array} { c } \text { SubTwo's Taxable } \\\text { Income }\end{array} & \begin{array} { c } \text { Consolidated } \\\text { Taxable Income }\end{array} \\\text { Year 1 } & \$ 200,000 & \$ 50,000 & \$ 150,000 & \text { N/A } \\\text { Year 2 } & \$ 200,000 & ( \$ 60,000 ) & \$ 70,000 & \$ 210,000 \\\text { Year 3 } & \$ 20,000 & ( \$ 60,000 ) & ( \$ 40,000 ) & ? \\\text { Year 4 } & \$ 200,000 & \$ 130,000 & \$ 10,000 & ?\end{array}$$ How should the Year 3 consolidated net operating loss be apportioned among the group members?

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Definitions:

Personality Type

Distinct patterns of thought, feeling, and behavior that characterize an individual’s adjustments to the world; often categorized into specific types or categories.

Detached

Emotional or physical disengagement or separation from others, often as a defense mechanism or coping strategy.

Need for Privacy

The individual desire or requirement for personal space and confidentiality.

Neurotic Trends

Three categories of behaviors and attitudes toward oneself and others that express a person’s needs; Horney’s revision of the concept of neurotic needs.