oans are treated as constructive dividends when ____________. course hero

Can a loan to a shareholder be a constructive dividend?

Sep 01, 2019 · Question 4 1 / 1 pts Loans are treated as constructive dividends when _____. there are no bona fide loan terms there is no specific payback date there is no written agreement any of the above Constructive dividends are economic benefits to the shareholder that are not in the form of a direct cash or property dividend.

How is a constructive dividend received by a corporation measured?

“Constructive Dividends – A taxable benefit derived by a shareholder from his or her corporation that is not actually initiated by the board of directors as a dividend. Examples include unreasonable compensation, excessive rent payments, bargain purchases of corporate property, and shareholder use of corporate property.

What are examples of constructive dividends?

Mar 10, 2019 · 1 / 1 pts Question 2 Loans are treated as constructive dividends when _____. there are no bona fide loan terms there is no specific payback date there is no written agreement any of the above Constructive dividends are economic benefits to the shareholder that are not in the form of a direct cash or property dividend.

Will the IRS continue to raise the constructive dividend issue?

Question 3 1 / 1 pts Loans are treated as constructive dividends when _____. there are no bona fide loan terms there is no specific payback date there is no written agreement any of the above Correct! Constructive dividends are economic benefits to the shareholder that are not in the form of a direct cash or property dividend.

What is constructive dividend?

Constructive dividends result in an unintended and unfavorable recharacterization by the IRS of a corporate - shareholder transaction as a dividend. All that is required for treatment of a transaction as a constructive dividend is a finding by the IRS that a shareholder received some benefit from the corporation.

Is fringe benefit included in income?

No amount is included in an employee's income if the employee reimburses the employer for the fair market value (FMV) of the fringe benefit. Unless the corporation elects a special valuation rule, the FMV is based on the facts and circumstances, which generally means the amount that would be paid in an independent arm's - length transaction (Regs.

Is a dividend deductible?

Such dividends are income to the shareholder but are not deductible by the corporation. Corporate payments for shareholder expenses have also been deemed to be additional compensation to shareholders ( Ghosn, T.C. Memo. 1995 - 192 ). If the corporation is paying a shareholder's expenses, the shareholder and the corporation should determine if ...