Your client, a start-up accrual basis taxpayer, has asked you to prepare its initial tax return. When
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Question:
Your client, a start-up accrual basis taxpayer, has asked you to prepare its initial tax return. When examining its financial statements and audit work papers, you notice employee benefit accruals such as vacation and sick leave payables within the audit work papers. This means there was an accompanying expense on the income statement. How would you treat these expenses on the tax return?
A) Deduct them in full without any limitation
B) Deduct only the amount estimated to be incurred within 8 ½ months after year end.
C) Deduct only the amount estimated to be incurred within 12 months after year end.
D) None of the above
Related Book For
Business Communication Essentials a skill based approach
ISBN: 978-0132971324
6th edition
Authors: Courtland L. Bovee, John V. Thill
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