Announcement

Collapse
No announcement yet.

C corp Loss

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    C corp Loss

    1) "C" corp client paid 2007 federal tax of $26000 in 2008. Do I deduct anywhere?

    This is recorded in QB of 2008. Is this a item that is in Quick Books but not deducted on Tax Return?


    (2) This client, C corp, has a Loss of $58000 in 2008. He had income of $177,000 in 2007. He did pay tax of $26000 on this 2007 income. Can I take loss of 2008 (58000) and apply to 2007? (Carryback)

    #2
    Corp Loss

    Can any one help? Can I do 1139 for 2007 or just 1120X

    Thanks!

    Comment


      #3
      Yes Carryback

      Your $58K loss is treated like an NOL, and carries back two years to 2006. If the loss is not all used up in 2006 (or if the C corp did not exist then), the remainder is applied to 2007. Whatever profit remains in 2007 has it's taxes recalculated, and you can then apply for a refund. I believe form 1045 can be used for this.

      The federal income tax paid is not a deduction. If you paid state income taxes in 2008 as a result of 2007 profit, they would be a deduction for federal purposes.

      Also at issue is the cash-versus-accrual method, but really beyond the scope of what you are asking. Federal taxes are not a tax deduction under either method, although they are reported on the financials as an expense.

      Comment


        #4
        Correction

        my apologies. Does not appear Form 1045 is available for Corporations. You are correct in choosing form 1139.

        Comment


          #5
          Originally posted by Nashville View Post
          Your $58K loss is treated like an NOL, and carries back two years to 2006. If the loss is not all used up in 2006 (or if the C corp did not exist then), the remainder is applied to 2007. Whatever profit remains in 2007 has it's taxes recalculated, and you can then apply for a refund. I believe form 1045 can be used for this.

          The federal income tax paid is not a deduction. If you paid state income taxes in 2008 as a result of 2007 profit, they would be a deduction for federal purposes.

          Also at issue is the cash-versus-accrual method, but really beyond the scope of what you are asking. Federal taxes are not a tax deduction under either method, although they are reported on the financials as an expense.
          Thank you!

          Client is on a Accrual basis.
          I did accrue 2007 taxes and apllied payment in 2008 to it.

          Comment


            #6
            1139

            Originally posted by Nashville View Post
            my apologies. Does not appear Form 1045 is available for Corporations. You are correct in choosing form 1139.

            So you file 2008 return and then file 1139 seperatley?

            Comment


              #7
              Concurrently or Separately

              I would process the 1139 separately, but after filing the 1120.

              I don't think you break any "rules" if you file them concurrently, I've just had problems in the past sending two separate returns in at the same time.

              Comment

              Working...
              X