Which of the following methods is utilized by states to ensure collection of tax from nonresident shareholders?
A)Withholding from distributions to nonresident shareholders
B)Revocation of the corporation's state S election if nonresident shareholders do not properly report S corporation income
C)Imposition of a corporate level tax on income allocable to nonresident shareholders
D)Allowing the filing of a single "composite" return on behalf of all nonresident shareholders
E)All of the above

Question

Quizplus · Accepted Answer

States use various methods to ensure they collect taxes from nonresident shareholders of S corporations. These methods include withholding taxes from distributions to nonresident shareholders, potentially revoking the corporation's state S election if nonresident shareholders do not properly report their income, imposing a corporate-level tax on income allocable to nonresident shareholders, and allowing the filing of a single "composite" return on behalf of all nonresident shareholders.

Which of the Following Methods Is Utilized by States to Ensure