If in 2006 the Taxpayer Has a Foreign Loss of $30,000

question 46

Multiple Choice

If in 2006 the taxpayer has a foreign loss of $30,000 in the general limitation category,foreign-source income of $100,000 in the high withholding interest limitation category and $200,000 in the passive limitation category basket,the numerators for the FTC limitation baskets are:

• A)$70,000 in the high withholding interest category and $200,000 in the passive limitation category.
• B)$100,000 in the high withholding interest category and $170,000 in the passive limitation category.
• C)$100,000 in the high withholding interest category and $200,000 in the passive limitation category.
• D)$0 in the general limitation category, $90,000 in the high withholding interest category, and $180,000 in the passive limitation category.
• E)None of the above.

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Definitions:

Total Common Stock

The aggregate value or amount of all shares of common stock issued by a company.

Net Income Before Taxes

A financial measure showing a company's profitability after accounting for all expenses except taxes.

Stockholders' Equity

The ownership interest of shareholders in a company, represented by the company's assets minus its liabilities.

Earnings Per Share

A company's profit divided by its number of outstanding shares of common stock, indicating the profitability available to shareholders on a per-share basis.