Which of the following statements is correct regarding S corporation estimated taxes?
A)S corporations never pay estimated taxes.
B)S corporations with a federal income tax liability of $500 due to the built-in gains tax or excess net passive income tax must pay estimated taxes.
C)S corporations that owe $5,000 in LIFO recapture tax only must pay estimated taxes.
D)S corporations with a federal income tax liability of $100 due to the excess net passive income tax must pay estimated taxes.
E)None of the choices are correct.

Question

Quizplus · Accepted Answer

S corporations with a federal income tax liability of $500 due to the built-in gains tax or excess net passive income tax must pay estimated taxes. This is because these taxes are due in a lump sum at the end of the tax year and cannot be paid through withholding from employee wages.

Which of the Following Statements Is Correct Regarding S Corporation