ABC Corp.elected to be taxed as an S corporation when it was initially formed.During its first three years of existence, it reported passive investment income in excess of 25 percent of its gross receipts.Is ABC's S election terminated under the excess passive investment income test? If so, what is the effective date of the termination? If not, why not?

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The Answer of ABC Corp.elected to be taxed as an S corporation when it was initially formed.During its first three years of existence, it reported passive investment income in excess of 25 percent of its gross receipts.Is ABC's S election terminated under the excess passive investment income test? If so, what is the effective date of the termination? If not, why not?

ABC CorpElected to Be Taxed as an S Corporation When It