Gold Corporation,a calendar year cash basis taxpayer,made estimated tax payments of $400 each quarter in 2010,for a total of $1,600.Gold filed its 2010 tax return in 2011 and the return showed a tax liability $2,100.At the time of filing,March 15,2011,Gold paid an additional $500 in Federal income taxes.How does the additional payment of $500 impact Gold's E & P?

Question

Quizplus · Accepted Answer

The additional payment of $500 decreases Gold's Earnings and Profits (E & P) in 2011 because the payment was made in 2011, not in 2010.

Gold Corporation,a Calendar Year Cash Basis Taxpayer,made Estimated Tax Payments