In the current year,Crimson,Inc.,a calendar C corporation,has income from operations of $180,000 and operating deductions of $225,000.Crimson also had $30,000 of dividends from a 15% stock ownership in a domestic corporation.Which of the following statements is correct with respect to Crimson for the current year?
A)Crimson's NOL is $15,000.
B)A dividends received deduction is not allowed in computing Crimson's NOL.
C)The NOL is carried back 3 years and forward 10 years by Crimson.
D)Crimson's dividends received deduction is $21,000.
E)None of the above.

Question

Quizplus · Accepted Answer

Crimson's dividends received deduction is $21,000. The dividends received deduction is 70% of the dividends received from a domestic corporation. In this case, Crimson received $30,000 in dividends, so the dividends received deduction is $30,000 x 70% = $21,000.

In the Current Year,Crimson,Inc