Alb,Bud,and Coe constitute an affiliated group of corporations.Which of the following tax effects becomes more restrictive if an election is made to file on a consolidated basis?
A)Choice of members' tax accounting methods.
B)Use of the lower tax rate brackets.
C)Use of the $40,000 AMT exemption.
D)Choice of members' tax year ends.

Question

Quizplus · Accepted Answer

If an election is made to file on a consolidated basis, all members of the affiliated group must have the same tax year end. This can be more restrictive than if each member had the option to choose their own tax year end. Therefore, choice of members' tax year ends becomes more restrictive.

Alb,Bud,and Coe Constitute an Affiliated Group of Corporations