The Alpha-Beta affiliated group has a consolidated regular tax amount of $52,000 and a tentative minimum tax amount of $50,000 in the current year.The maximum general business credit that can be used on the consolidated return is
A)$2,000.
B)$6,750.
C)$50,000.
D)none of the above

Question

Quizplus · Accepted Answer

A)The general business credit that can be used equals the group's net income tax ($52,000)minus the larger of (1)tentative minimum tax ($50,000),or (2)25% of net income tax in excess of $25,000 ($6,750)or $2,000 ($52,000 - $50,000).

The Alpha-Beta Affiliated Group Has a Consolidated Regular Tax Amount