Santana Corporation operates a golf shop.It properly elected Subchapter S status on March 1 of the current year.Taxable income for the current year is $120,000.What is Santana Corporation's income tax liability?

Question

Quizplus · Accepted Answer

As a Subchapter S corporation, Santana Corporation is a pass-through entity, meaning it does not pay federal income tax at the corporate level. Instead, the income is passed through to the shareholders, who report it on their personal tax returns. Therefore, the corporation itself has no income tax liability.

Santana Corporation Operates a Golf Shop