Which of the following are likely to be a separately stated item for an S corporation.

Question

Quizplus · Accepted Answer

The gain on the sale of depreciable property used in a business and held for more than one year is likely to be a separately stated item for an S corporation. This is because S corporations pass through their income, deductions, and credits to their shareholders, who then report them on their individual tax returns. Separately stated items are those that are reported separately to shareholders and affect their individual tax liability. In this case, the gain on the sale of depreciable property would be reported separately and potentially subject to different tax treatment for each shareholder. Interest expense on a business loan and deduction for accrued salaries are not likely to be separately stated items as they would be treated as ordinary business expenses that are passed through as part of the S corporation's overall income. Similarly, cost of goods sold would also not be a separately stated item as it is a common expense for businesses and would be reported as part of the S corporation's overall income.

Which of the Following Are Likely to Be a Separately