Which of the Following Is Not a Requirement of a Subchapter

question 66

Multiple Choice

Which of the following is not a requirement of a Subchapter S corporation?

• A) It must be a domestic corporation.
• B) It must have no more than 50 shareholders.
• C) A corporation or partnership cannot be a shareholder.
• D) It may have only one class of stock.

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Definitions:

AGI

Adjusted Gross Income, which is gross income minus adjustments, serving as the basis for calculating taxable income on an individual's federal tax return.

Rental Loss

Occurs when the costs of maintaining and renting out a property exceed the income it generates, leading to a financial loss for the owner.

Standard Deduction

A fixed dollar amount that reduces the income on which you're taxed, varying by filing status, and claimed by those not itemizing deductions.

AMT Adjustments

Modifications required under the Alternative Minimum Tax rules to calculate certain items of income and deductions differently than for regular tax purposes.