Juanita Owns 45% of the Stock in a C Corporation

question 31

Multiple Choice

Juanita owns 45% of the stock in a C corporation that had a profit of $120,000 in 2011. Carlos owns a 45% interest in a partnership that had a profit of $120,000 during the year. The corporation distributed $20,000 to Juanita, and the partnership distributed $20,000 to Carlos. Which of the following statements relating to 2011 is incorrect?

• A) Juanita must report $20,000 of income from the corporation.
• B) The corporation must pay corporate tax on $120,000 of income.
• C) Carlos must report $20,000 of income from the partnership.
• D) The partnership is not subject to a Federal entity-level income tax.
• E) None of the above.

---

Definitions:

Postgendered

Referring to a society or a concept where traditional gender roles and identity markers are transcended, allowing individuals to define themselves beyond male or female categories.

Klinefelter Syndrome

A genetic condition found in males resulting from an extra X chromosome, characterized by symptoms like reduced muscle mass, facial hair, and infertility.

Hypospadias

A birth defect in males where the opening of the urethra is not located at the tip of the penis.

Congenital Adrenal Hyperplasia

A group of inherited genetic disorders that affect the adrenal glands, leading to a production imbalance of adrenal hormones.