Question

Ypsi Corporation has a precredit U.S. tax of $420,000 on $2,000,000 of taxable income in the...

Ypsi Corporation has a precredit U.S. tax of $420,000 on $2,000,000 of taxable income in the current year. Ypsi has $400,000 of foreign source taxable income characterized as foreign branch income and $150,000 of foreign source taxable income characterized as passive category income. Ypsi paid $100,000 of foreign income taxes on the foreign branch income and $30,000 of foreign income taxes on the passive category income. What amount of foreign tax credit (FTC) can Ypsi use on its U.S. tax return and what is the amount of the FTC carryforward, if any?

Homework Answers

Answer #1

doubts rae always welcomed.

pleasse upvote

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Horton Corporation is a 100 percent owned Canadian subsidiary of Cruller Corporation, a U.S. corporation. Horton...
Horton Corporation is a 100 percent owned Canadian subsidiary of Cruller Corporation, a U.S. corporation. Horton had post-1986 earnings and profits of C$2,400,000 and post-1986 foreign taxes of $1,600,000. During the current year, Horton paid a dividend of C$600,000 to Cruller. The dividend was characterized as general category income for FTC purposes. The dividend was subject to a withholding tax of C$30,000. Assume an exchange rate of C$1 = $1. Cruller reported U.S. sourced taxable income of $2,000,000 before considering...
Janus Company reports taxable income $4.000,000 and a U.S. tax liability of $1,400,000. Of the taxable...
Janus Company reports taxable income $4.000,000 and a U.S. tax liability of $1,400,000. Of the taxable income, $3,000,000 is foregin source and $1,000,000 is U.S. source income. Of the foregin source income, $500,000 is classfied as foregin personal holding company income. Janus paid foregin taxes of $1,000,000 on active business income and $100,000 on passive income such as interest and dividends. (Assume 35% tax rate). Calculate the amount of foregin tax credit available to Janus.
Orleans Corporation, a U.S. corporation, reported U.S. taxable income of $2,000,000. Included in the computation of...
Orleans Corporation, a U.S. corporation, reported U.S. taxable income of $2,000,000. Included in the computation of taxable income was a $400,000 dividend from a 5%-owned Canadian subsidiary. A withholding tax of $8,000 was imposed on the dividend. What is Orleans’s net U.S. tax liability?
Chapeau Company, a U.S. corporation, operates through a branch in Champagnia. The source rules used by...
Chapeau Company, a U.S. corporation, operates through a branch in Champagnia. The source rules used by Champagnia are identical to those used by the United States. For 2019, Chapeau has $4,800 of gross income: $2,880 from U.S. sources and $1,920 from sources within Champagnia. The $2,880 of U.S. source income and $1,680 of the foreign source income are attributable to manufacturing activities in Champagnia (foreign branch income). The remaining $240 of foreign source income is passive category interest income. Chapeau...
Chapeau Company, a U.S. corporation, operates through a branch in Champagnia. The source rules used by...
Chapeau Company, a U.S. corporation, operates through a branch in Champagnia. The source rules used by Champagnia are identical to those used by the United States. For 2017, Chapeau has $9,200 of gross income, $5,520 from U.S. sources and $3,680 from sources within Champagnia. The $5,520 of U.S. source income and $3,220 of the foreign source income are attributable to manufacturing activities in Champagnia (general category income). The remaining $460 of foreign source income is passive category interest income. Chapeau...
Blackwater Company has a foreign branch that earns income before income taxes of $500,000.  Income taxes paid...
Blackwater Company has a foreign branch that earns income before income taxes of $500,000.  Income taxes paid to the foreign government are $150,000 or 30%.  Sales and other taxes paid to the foreign government are $100,000.  Blackwater Company must include the $500,000 of foreign branch income in determining its home country taxable income.  In determining its taxable income, Blackwater can choose between taking a deduction for all foreign taxes paid or a credit only for foreign income taxes paid.  The corporate income tax rate in...
Trixie Company has a foreign branch in Switzerland that earns income before income taxes of $500,000....
Trixie Company has a foreign branch in Switzerland that earns income before income taxes of $500,000. Income taxes paid to the Swiss government are $150,000 or 30%. However, Switzerland is known for their extremely high local taxes - as such, Trixie Company's branch paid $250,000 to the Swiss government for sales and other local taxes. Trixie Company must include the $500,000 of Foreign branch income in determining its home country taxable income. In determining its taxable income, Trixie Company can...
Manhattan Pictures is a U.S. corporation that owns 100% of Alpha, a Greek corporation. Manhattan Pictures...
Manhattan Pictures is a U.S. corporation that owns 100% of Alpha, a Greek corporation. Manhattan Pictures receives a dividend of $42,000 from Alpha. Alpha has $320,000 of accumulated earnings and profits and has paid foreign taxes that total $60,000. Manhattan Pictures’ taxable income before consideration of the dividend is $30,000. Manhattan Pictures is subject to a flat 35% U.S. tax rate. a) What is Manhattan Pictures’ deemed paid foreign taxes with respect to the Alpha dividend? b) What is Manhattan...
Lili, Inc., a domestic corporation, operates a branch in France. The earnings record of the branch...
Lili, Inc., a domestic corporation, operates a branch in France. The earnings record of the branch is as follows. Year Taxable Income (Loss) Foreign Taxes Paid 1 ($25,000) $0 2 (40,000) 0 3 (10,000) 0 4 $120,000 40,000 Lili, Inc., reports U.S.-source taxable income of $500,000 each year. Assume a 35% U.S. tax rate. Round your answers to the nearest dollar. Ignoring any recapture, what is the tentative FTC for year 4? $________ What is the allowed FTC for year...
Krefeld, Inc. had the following taxable income: U.S. source income $ 1,435,000 Foreign source income 850,000...
Krefeld, Inc. had the following taxable income: U.S. source income $ 1,435,000 Foreign source income 850,000 Taxable income $ 2,285,000 Krefeld, Inc. paid $315,000 foreign income tax. Requirements: Determine the following: (1) U.S. Tax before Credits: (2) Foreign Tax Credit: (3) U.S. Tax Liability after Credits: