Jake Is the Sole Shareholder of an S Corporation That

question 61

True/False

Jake is the sole shareholder of an S corporation that earned $50,000 in 2010.The corporation was short on cash and therefore distributed only $15,000 to Jake in 2010.Jake is required to recognize $50,000 of income from the S corporation in 2010.

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Definitions:

Money Laundering

The illegal process of making large amounts of money generated by criminal activity, such as drug trafficking or terrorist funding, appear to be earned legitimately.

Manuel Noriega

A Panamanian military officer and politician who was the de facto ruler of Panama from 1983 to 1989 before being removed from power by an American military intervention.

Drug Running

The illegal smuggling of controlled substances or narcotics across borders or through jurisdictions, often involving organized crime.

Allied Troops

Refers to the military forces of allied countries, typically in the context of the First and Second World Wars, who joined forces against common enemies.