Question : Question
The memo should be between 1,000-1,500 : 5858
The memo should be between 1,000-1,500 words with the following sections in order presented: Facts, Analysis, and Conclusion
This will be for whatever state is chosen
. State corporate income tax laws. Go to the Internet site of a state revenue department of your choice or the state assigned to you by the instructor. Links to all state revenue departments can be found at www.taxsites.com/State-Links.html. Download and print out the instructions for filing an income tax return for a C corporation, including the instructions for apportioning income. Note that some states refer to their corporate income tax as a “corporate franchise tax.
” Using the tax return instructions, answer the following questions regarding that state’s corporate income tax laws.
a. What is the corporate tax rate (or tax rate schedule)?
b. Under what circumstances must a corporation file an income tax return?
c. What are the filing options for a group of commonly controlled corporations?
d. Does the computation of state taxable income start with federal taxable income? If so, does the computation begin with line 28 or line 30 of federal Form 1120?
e. Briefly describe any addition or subtraction modifications that are required for the following items:
(i) dividends-received deduction,
(ii) state and local income taxes,
(iii) interest earned on debt obligations of the federal government,
(iv) interest earned on debt obligations of state and local governments,
(v) expenses related to federal or state tax credits, (vi) federal Section 168(k) first-year bonus depreciation,
(vii) royalties and interest paid to related parties,
(viii) federal Section 199 domestic production activities deduction,
(ix) federal Subpart F income and Section 78 gross-up income related to foreign (non-U.S.) subsidiaries, and
(x) net operating loss deductions.
f. What is the apportionment formula?
g. Are specialized apportionment formulae required for financial institutions or transportation companies? If so, what are they?
(iii) Dividends to the extent included in taxable income
(iv) Royalties on business property (
v) Capital gains from sales of intangible business property
(vi) Gains from the sale of fixed assets such as machinery and equipment
i. Is there a sales factor throwback rule?