The corporate-level tax on recognized built-in gains applies in 2015 when an S corporation disposes of an asset in a taxable disposition within ten years after the date on which the S election took effect.

Question

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The statement is true. The corporate-level tax on recognized built-in gains applies in 2015 when an S corporation disposes of an asset in a taxable disposition within ten years after the date on which the S election took effect. After 2015, the tax applies if the disposition occurs within five years after the date on which the S election took effect.

The Corporate-Level Tax on Recognized Built-In Gains Applies in 2015