Question

1.) A Corporation owns stock in B Corporation, and A Corporation receives a dividend from B Corporation. Ignoring the dividends-received deduction, what book–tax differences will A report for the year relating to its investment in B? Explain.

2.)What is the due date for a calendar-year corporation tax return Form 1120 for 2020? Is it possible to extend the due date? Explain.

Answer 1

1)Nothing since the dividend received by A corporation is exempted from tax because on the same dividend tax will be collected from B Corporation as Corporate Dividend Tax so BA Corporation will not book any tax on the same.

2)a)The due date for a calendar-year corporation tax return Form 1120 for 2020 is

• 15th day of the 4th month after the end of the entity’s tax year (except for a June 30 fiscal-year entity); due April 15 for a calendar-year entity

• 15th day of the 3rd month after the end of the entity’s tax year for a June 30 fiscalyear entity; due September 15

b)Yes, it is possible to extend the Due Date

Extended Due Date

Automatic extension period of six months; due October 15 for a calendar-year entity. C corporations with tax years ending June 30 are eligible for an automatic extension period of seven months (six-month extension if filing Form 1120-POL)