Series 79 questions n answers rated A+ already passed 2024

Series 79Subchapter C Corp - correct answer Which does not pass through gains and losses To qualify as a REIT - correct answer a corporation must be organized under state laws in the US and have at least 100 shareholders by the second taxable year. It also must meet a 50/50 test for shareholder ownership, with five or fewer shareholders not owning more than 50% of its stock during the last half of the taxable year. A REIT will only pay taxes on earnings that we not paid out as dividend to shareholders. -75% of assets must be invested in RE 75% of revenues should be derived from RE 90% of earnings should be paid as dividends Offers higher yield than other investments due to this. C Corp. taxationE - correct answer Profits passed through to common stock investors as dividends, both the corporation and the investors pay income tax on profits and dividends. For a C corp, profits are taxable at the corporate level and then again at the investor level, if they are passed through as dividends on common stock. (double taxation) Subchapter S - correct answer ownership rules are somewhat limited, due primarily to the ability to pass through gains and losses. All investors must be individual investors and they must be domestic investors. Even then, there is a limit of 100 shareholders, which would preclude listing on an exchange. IRS Form 1120 - correct answer the corporate income tax return. It reports revenues, expenses and net losses of the corporate entity. Some other types of business entities, including S Corps and Limited Partnerships, pass through their profits and losses to individual partners or investors. C corps pays federal income on this form. IPO - correct answer the first sale of stock in the public equity markets by a privately held company. An IPO provides numerous benefits for the issuer including; obtaining growth capital; providing liquidity of