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  /Title (tax-cumulative.pdf)
  /Creator (Cheatography)
  /Author (nova-cane98)
  /Subject (Tax Cumulative Cheat Sheet)
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\begin{tabulary}{11cm}{L}
    \vspace{-2pt}\large{\bf{\textcolor{DarkBackground}{\textrm{Tax Cumulative Cheat Sheet}}}} \\
    \normalsize{by \textcolor{DarkBackground}{nova-cane98} via \textcolor{DarkBackground}{\uline{cheatography.com/217313/cs/47907/}}}
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  \mymulticolumn{2}{p{5.377cm}}{\bf\textcolor{white}{Cheatographer}}  \\
  \vspace{-2pt}nova-cane98 \\
  \uline{cheatography.com/nova-cane98} \\
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  \mymulticolumn{1}{p{5.377cm}}{\bf\textcolor{white}{Cheat Sheet}}  \\
   \vspace{-2pt}Not Yet Published.\\
   Updated 11th May, 2026.\\
   Page {\thepage} of \pageref{LastPage}.
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  Measure your website readability!\\
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\begin{multicols*}{3}

\begin{tabularx}{5.377cm}{x{1.89126 cm} x{3.08574 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{E \& P}}  \tn
% Row 0
\SetRowColor{LightBackground}
What is E\&P? & a tax concept — not defined in the Code — that measures a corporation's economic ability to pay dividends without impairing its capital \tn 
% Row Count 6 (+ 6)
% Row 1
\SetRowColor{white}
 & the tax version of "retained earnings," \tn 
% Row Count 8 (+ 2)
% Row 2
\SetRowColor{LightBackground}
 & Upper limit on the amount shareholders must recognize as dividend income \tn 
% Row Count 11 (+ 3)
% Row 3
\SetRowColor{white}
 & Includes current year E\&P plus accumulated E\&P \tn 
% Row Count 13 (+ 2)
% Row 4
\SetRowColor{LightBackground}
No statute of limitations & the IRS can always redetermine E\&P, so corporations should keep meticulous records \tn 
% Row Count 17 (+ 4)
% Row 5
\SetRowColor{white}
Current E\&P & Taxable income adjusted for the current year. Calculated by adding back excluded items and subtracting certain nondeductible items. \tn 
% Row Count 23 (+ 6)
% Row 6
\SetRowColor{LightBackground}
Accumulated E\&P & Sum of all prior years' current E\&P since 1913, reduced by prior distributions from E\&P. A running balance carried forward year to year. \tn 
% Row Count 29 (+ 6)
% Row 7
\SetRowColor{white}
Computing E\&P & Start with taxable income, then apply adjustments. The goal is to reflect actual economic capacity to pay dividends. \tn 
% Row Count 34 (+ 5)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§§351 \&\& 357}}  \tn
% Row 0
\SetRowColor{LightBackground}
§351 the basic rule & No gain or loss is recognized when property is transferred to a corporation solely in exchange for stock, IF the transferors control the corporation (own ≥80\% immediately after). \tn 
% Row Count 9 (+ 9)
% Row 1
\SetRowColor{white}
 & Services ≠ property → transferor of services does NOT count toward 80\% control and must recognize ordinary income on the FMV of stock received for services. \tn 
% Row Count 17 (+ 8)
% Row 2
\SetRowColor{LightBackground}
 & Boot received (non-stock consideration) triggers gain recognition \tn 
% Row Count 21 (+ 4)
% Row 3
\SetRowColor{white}
 & recognized gain = lesser of boot received or realized gain. Losses are never recognized. \tn 
% Row Count 26 (+ 5)
% Row 4
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{§351 shareholder's stock basis} \tn 
% Row Count 27 (+ 1)
% Row 5
\SetRowColor{white}
Shareholder's stock basis = & Basis of property transferred \tn 
% Row Count 29 (+ 2)
% Row 6
\SetRowColor{LightBackground}
 & + Gain recognized \tn 
% Row Count 30 (+ 1)
\end{tabularx}
\par\addvspace{1.3em}

\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§§351 \&\& 357 (cont)}}  \tn
% Row 7
\SetRowColor{LightBackground}
 & − Boot received \tn 
% Row Count 1 (+ 1)
% Row 8
\SetRowColor{white}
 & − Liabilities assumed by the corp \tn 
% Row Count 3 (+ 2)
% Row 9
\SetRowColor{LightBackground}
Corporation's basis in the asset = & transferor's basis \tn 
% Row Count 5 (+ 2)
% Row 10
\SetRowColor{white}
 & + any gain recognized by the transferor (also called a carryover basis). \tn 
% Row Count 9 (+ 4)
% Row 11
\SetRowColor{LightBackground}
§357 General rule (a) & Liability assumed is NOT boot for gain recognition \tn 
% Row Count 12 (+ 3)
% Row 12
\SetRowColor{white}
 & But it DOES reduce the shareholder's stock basis. \tn 
% Row Count 15 (+ 3)
% Row 13
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Exception 1: (b)} \tn 
% Row Count 16 (+ 1)
% Row 14
\SetRowColor{white}
If the liability lacks a business purpose or is a tax avoidance device → & ENTIRE liability amount is treated as boot (taints all liabilities) \tn 
% Row Count 20 (+ 4)
% Row 15
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Exception 2 (c)} \tn 
% Row Count 21 (+ 1)
% Row 16
\SetRowColor{white}
If total liabilities assumed EXCEED the basis of ALL assets transferred & recognized gain = excess (liabilities − total basis) \tn 
% Row Count 25 (+ 4)
% Row 17
\SetRowColor{LightBackground}
 & {\emph{This prevents a negative stock basis.}} \tn 
% Row Count 27 (+ 2)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{§357(b) predominates over §357(c). If both apply, use §357(b) — the larger gain recognition rules (all liabilities as boot). \newline  \newline Cash basis taxpayers: accounts payable are excluded from §357(c)}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
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\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{Redemptions \& Complete liquidations}}  \tn
% Row 0
\SetRowColor{LightBackground}
Redemptions: & qualifying vs. non-qualifying \tn 
% Row Count 2 (+ 2)
% Row 1
\SetRowColor{white}
non-qualifying = & dividend distribution \tn 
% Row Count 4 (+ 2)
% Row 2
\SetRowColor{LightBackground}
 & {\emph{tax at ordinary rates up to E\&P}} \tn 
% Row Count 6 (+ 2)
% Row 3
\SetRowColor{white}
qualifying = & sale-or-exchange treatment \tn 
% Row Count 8 (+ 2)
% Row 4
\SetRowColor{LightBackground}
 & {\emph{ gain/loss = proceeds − stock basis}} \tn 
% Row Count 10 (+ 2)
% Row 5
\SetRowColor{white}
{\bf{Four qualifiers §302(b)}} & (1) complete termination of interest \tn 
% Row Count 12 (+ 2)
% Row 6
\SetRowColor{LightBackground}
 & (2) substantially disproportionate \tn 
% Row Count 14 (+ 2)
% Row 7
\SetRowColor{white}
 & {\emph{shareholder drops below 50\% voting and ratio of shares drops to 80\% or less of pre-redemption \%}} \tn 
% Row Count 19 (+ 5)
% Row 8
\SetRowColor{LightBackground}
 & (3) not essentially equivalent to a dividend \tn 
% Row Count 22 (+ 3)
% Row 9
\SetRowColor{white}
 & (4) partial liquidation (corpo event) \tn 
% Row Count 24 (+ 2)
% Row 10
\SetRowColor{LightBackground}
{\bf{Corpo effects-redemption}} & Corpo recognizes gain on distribution of appreciated property \tn 
% Row Count 28 (+ 4)
% Row 11
\SetRowColor{white}
 & {\emph{deemed sale}} \tn 
% Row Count 29 (+ 1)
% Row 12
\SetRowColor{LightBackground}
 & Loss → NOT recognized \tn 
% Row Count 31 (+ 2)
\end{tabularx}
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\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{Redemptions \& Complete liquidations (cont)}}  \tn
% Row 13
\SetRowColor{LightBackground}
How to recognize the loss? & Sell property THEN  then distribute the proceeds \tn 
% Row Count 3 (+ 3)
% Row 14
\SetRowColor{white}
E\&P reduction in a qualifying redemption: & E\&P is reduced by no more than the percentage of the corporation's stock redeemed (not the full redemption amount). \tn 
% Row Count 9 (+ 6)
% Row 15
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{{\bf{§331}}} \tn 
% Row Count 10 (+ 1)
% Row 16
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{Complete liquidations} \tn 
% Row Count 11 (+ 1)
% Row 17
\SetRowColor{LightBackground}
Shareholders: & liquidating distribution = proceeds from sale of stock \tn 
% Row Count 14 (+ 3)
% Row 18
\SetRowColor{white}
 & {\emph{ sale-or-exchange treatment // capital gain/loss}} \tn 
% Row Count 17 (+ 3)
% Row 19
\SetRowColor{LightBackground}
 & Gain or loss = liquidating proceeds − stock basis \tn 
% Row Count 20 (+ 3)
% Row 20
\SetRowColor{white}
Corporation recognize: & gain or loss on assets distributed in liquidation \tn 
% Row Count 23 (+ 3)
% Row 21
\SetRowColor{LightBackground}
 & treated as FMV on the date of distribution \tn 
% Row Count 26 (+ 3)
% Row 22
\SetRowColor{white}
 & Losses ARE recognized in a complete liquidation \tn 
% Row Count 29 (+ 3)
% Row 23
\SetRowColor{LightBackground}
Exception: & loss limitation \tn 
% Row Count 30 (+ 1)
\end{tabularx}
\par\addvspace{1.3em}

\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{Redemptions \& Complete liquidations (cont)}}  \tn
% Row 24
\SetRowColor{LightBackground}
 & IF (distributed property) was acquired in a §351 transaction within 5 years \&\& (distribution) to related party THEN loss may be disallowed or limited. \tn 
% Row Count 8 (+ 8)
% Row 25
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{{\bf{TLDR}}} \tn 
% Row Count 9 (+ 1)
% Row 26
\SetRowColor{LightBackground}
Regular (non-liquidating) distribution: & corpo = deemed sale, rec gain NOT loss \tn 
% Row Count 11 (+ 2)
% Row 27
\SetRowColor{white}
 & Shareholder = dividend (ala w/i E\&P) \tn 
% Row Count 13 (+ 2)
% Row 28
\SetRowColor{LightBackground}
Qualifying redemption: & shareholder = sale treatment \tn 
% Row Count 15 (+ 2)
% Row 29
\SetRowColor{white}
 & corpo = deemed sale, rec gain NOT loss \tn 
% Row Count 17 (+ 2)
% Row 30
\SetRowColor{LightBackground}
Complete liquidation: & shareholder = sale treatment \tn 
% Row Count 19 (+ 2)
% Row 31
\SetRowColor{white}
 & corpo = recognizes both gains AND losses \tn 
% Row Count 21 (+ 2)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§199A}}  \tn
% Row 0
\SetRowColor{LightBackground}
§199A allows noncorporate taxpayers to deduct up to 20\% of qualified business income (QBI). & Available whether taxpayer itemizes or takes standard deduction \tn 
% Row Count 5 (+ 5)
% Row 1
\SetRowColor{white}
QBI deduction = lesser of: & (1) 20\% × QBI \tn 
% Row Count 7 (+ 2)
% Row 2
\SetRowColor{LightBackground}
OR & 20\% × modified taxable income \tn 
% Row Count 9 (+ 2)
% Row 3
\SetRowColor{white}
MTI & taxable income - net capital gain \tn 
% Row Count 11 (+ 2)
% Row 4
\SetRowColor{LightBackground}
QBI & net ordinary income from a qualified trade or business conducted as a sole proprietorship, partnership, or S corporation. \tn 
% Row Count 18 (+ 7)
% Row 5
\SetRowColor{white}
QBI excludes: & capital gains/losses \tn 
% Row Count 19 (+ 1)
% Row 6
\SetRowColor{LightBackground}
 & dividends \tn 
% Row Count 20 (+ 1)
% Row 7
\SetRowColor{white}
 & interest income (unless properly allocable to the business) \tn 
% Row Count 23 (+ 3)
% Row 8
\SetRowColor{LightBackground}
 & reasonable compensation paid to the owner, and guaranteed payments to partners \tn 
% Row Count 27 (+ 4)
% Row 9
\SetRowColor{white}
QBI is reduced by: & self-employment tax deduction {[}§164(f){]} \tn 
% Row Count 29 (+ 2)
% Row 10
\SetRowColor{LightBackground}
 & self-employed health insurance {[}§162(l){]} \tn 
% Row Count 32 (+ 3)
\end{tabularx}
\par\addvspace{1.3em}

\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§199A (cont)}}  \tn
% Row 11
\SetRowColor{LightBackground}
 & qualified retirement plan contributions {[}§404{]} \tn 
% Row Count 3 (+ 3)
% Row 12
\SetRowColor{white}
High-income limitations & For 2025: thresholds are \$394,600 (MFJ) / \$197,300 (single) \tn 
% Row Count 6 (+ 3)
% Row 13
\SetRowColor{LightBackground}
Above these, the deduction is limited to the GREATER of: & (a) 50\% of W-2 wages paid by the business \tn 
% Row Count 9 (+ 3)
% Row 14
\SetRowColor{white}
 & (b) 25\% of W-2 wages + 2.5\% of unadjusted basis of qualified property \tn 
% Row Count 13 (+ 4)
% Row 15
\SetRowColor{LightBackground}
 & For specified service trade or business (SSTB — health, law, accounting, consulting, etc.): the QBI deduction phases out completely above the threshold. \tn 
% Row Count 21 (+ 8)
% Row 16
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{If a taxpayer has a net qualified business loss across all businesses in a year, no QBI deduction is allowed and the loss carries forward to the next year to reduce QBI (but not below zero).} \tn 
% Row Count 25 (+ 4)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Example 46:  \newline QBI from A = \$20,000; Loss from B = (\$50,000) Net = (\$30,000) → No deduction, \$30,000 carryforward  \newline Next year: QBI \$70,000 − \$30,000 carryforward = \$40,000 net QBI → deduction = \$8,000}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{E\&P}}  \tn
% Row 0
\SetRowColor{LightBackground}
E\&P = & the corporation's economic ability to pay dividends \tn 
% Row Count 3 (+ 3)
% Row 1
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{Distribution treatment:} \tn 
% Row Count 4 (+ 1)
% Row 2
\SetRowColor{LightBackground}
First: Dividend income & E\&P: current first, then accumulated \tn 
% Row Count 6 (+ 2)
% Row 3
\SetRowColor{white}
Second: Return of capital & reduces shareholder's stock basis \tn 
% Row Count 8 (+ 2)
% Row 4
\SetRowColor{LightBackground}
Third: Capital gain & when basis reaches zero \tn 
% Row Count 10 (+ 2)
% Row 5
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{Allocating E\&P:} \tn 
% Row Count 11 (+ 1)
% Row 6
\SetRowColor{LightBackground}
If current E\&P is + \&\& total distributions \textgreater{} current E\&P & prorate current E\&P \tn 
% Row Count 14 (+ 3)
% Row 7
\SetRowColor{white}
Current E\&P to each distribution = & (That distribution / Total distributions) × Current E\&P \tn 
% Row Count 17 (+ 3)
% Row 8
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Property distributions: corpo} \tn 
% Row Count 18 (+ 1)
% Row 9
\SetRowColor{white}
When Corpo distributes appreciated property: & deemed sale (recognize at FMV) \tn 
% Row Count 21 (+ 3)
% Row 10
\SetRowColor{LightBackground}
When Corpo distributes depreciated property: & Loss on distribution → NOT recognized \tn 
% Row Count 24 (+ 3)
% Row 11
\SetRowColor{white}
Shareholder receives: & dividend = FMV of property (to extent of E\&P) \tn 
% Row Count 27 (+ 3)
% Row 12
\SetRowColor{LightBackground}
Shareholder's basis in property: & FMV at date of distribution \tn 
% Row Count 29 (+ 2)
% Row 13
\SetRowColor{white}
Corporation's E\&P reduced by: & FMV of property (net of liabilities assumed by shareholder) \tn 
% Row Count 32 (+ 3)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{If current E\&P is positive but accumulated E\&P has a deficit: do NOT net them.  \newline  \newline If accumulated E\&P is positive but current E\&P is a deficit: net both at the date of distribution}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.04057 cm} x{2.93643 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{consolidated returns and affiliated groups}}  \tn
% Row 0
\SetRowColor{LightBackground}
Affiliated group: & parent owns at least 80\% of voting stock and value of all subsidiaries. \tn 
% Row Count 4 (+ 4)
% Row 1
\SetRowColor{white}
Consolidated return: & allows losses of one member to offset income of another. \tn 
% Row Count 7 (+ 3)
% Row 2
\SetRowColor{LightBackground}
 & eliminates intercompany transactions \tn 
% Row Count 9 (+ 2)
% Row 3
\SetRowColor{white}
DRD in a consolidated group: & 100\% DRD applies to dividends \tn 
% Row Count 11 (+ 2)
% Row 4
\SetRowColor{LightBackground}
Built-in losses on assets & subject to  §351 —losses that existed before joining the group can be limited. \tn 
% Row Count 15 (+ 4)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.18988 cm} x{2.78712 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{Gain/Loss/Basis}}  \tn
% Row 0
\SetRowColor{LightBackground}
(1) Taxable transaction & Realized = FVM - OG Basis \tn 
% Row Count 2 (+ 2)
% Row 1
\SetRowColor{white}
 & Recognized = same \tn 
% Row Count 3 (+ 1)
% Row 2
\SetRowColor{LightBackground}
 & New Basis = FMV \tn 
% Row Count 4 (+ 1)
% Row 3
\SetRowColor{white}
(2) Deferred & Realized = FVM - OG Basis \tn 
% Row Count 6 (+ 2)
% Row 4
\SetRowColor{LightBackground}
 & Recognized = 0 (all deferred) \tn 
% Row Count 8 (+ 2)
% Row 5
\SetRowColor{white}
 & New Basis = OG basis \tn 
% Row Count 9 (+ 1)
% Row 6
\SetRowColor{LightBackground}
(3) Deferred with boot & {\emph{FMV = OG basis - boot}} \tn 
% Row Count 11 (+ 2)
% Row 7
\SetRowColor{white}
 & Realized = FVM - OG Basis \tn 
% Row Count 13 (+ 2)
% Row 8
\SetRowColor{LightBackground}
 & Recognized = Realized - Boot \tn 
% Row Count 15 (+ 2)
% Row 9
\SetRowColor{white}
 & New Basis = FMV - Recognized \tn 
% Row Count 17 (+ 2)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{If there is a realized LOSS, boot NEVER triggers recognition in a deferred exchange.  \newline Deferred with boot : recognized = lesser of boot or realized gain}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
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\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§368 Reorgs}}  \tn
% Row 0
\SetRowColor{LightBackground}
§368 & creates deferral \tn 
% Row Count 1 (+ 1)
% Row 1
\SetRowColor{white}
requirements: & (1) a written plan of reorganization \tn 
% Row Count 3 (+ 2)
% Row 2
\SetRowColor{LightBackground}
 & (2) continuity of interest \tn 
% Row Count 5 (+ 2)
% Row 3
\SetRowColor{white}
 & {\emph{shareholders must retain equity in the acquiring corp}} \tn 
% Row Count 8 (+ 3)
% Row 4
\SetRowColor{LightBackground}
 & (3) continuity of business enterprise \tn 
% Row Count 10 (+ 2)
% Row 5
\SetRowColor{white}
 & (4) a sound business purpose \tn 
% Row Count 12 (+ 2)
% Row 6
\SetRowColor{LightBackground}
 & (5) the step transaction doctrine must not apply \tn 
% Row Count 15 (+ 3)
% Row 7
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{{\bf{Types}}} \tn 
% Row Count 16 (+ 1)
% Row 8
\SetRowColor{LightBackground}
Type A: merger or consolidation & All-in-one \tn 
% Row Count 18 (+ 2)
% Row 9
\SetRowColor{white}
 & -60\% boot allowed \tn 
% Row Count 19 (+ 1)
% Row 10
\SetRowColor{LightBackground}
 & -same tax attributes (NOL \& E\&P) \tn 
% Row Count 21 (+ 2)
% Row 11
\SetRowColor{white}
 & shareholders = 40\% voting stock \tn 
% Row Count 23 (+ 2)
% Row 12
\SetRowColor{LightBackground}
Type B: Stock-for-stock & Both Live \tn 
% Row Count 25 (+ 2)
% Row 13
\SetRowColor{white}
 & -NO boot \tn 
% Row Count 26 (+ 1)
% Row 14
\SetRowColor{LightBackground}
 & - parent /subsidiary \tn 
% Row Count 27 (+ 1)
% Row 15
\SetRowColor{white}
Type C: Stock-for-assets & Cull \tn 
% Row Count 29 (+ 2)
% Row 16
\SetRowColor{LightBackground}
Type D: Divisive & Divide \tn 
% Row Count 30 (+ 1)
\end{tabularx}
\par\addvspace{1.3em}

\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.4885 cm} x{2.4885 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{§368 Reorgs (cont)}}  \tn
% Row 17
\SetRowColor{LightBackground}
Type E: Recapitalization & Exchange inside \tn 
% Row Count 2 (+ 2)
% Row 18
\SetRowColor{white}
Type F: Change in identity, form, or place & Face-lift \tn 
% Row Count 5 (+ 3)
% Row 19
\SetRowColor{LightBackground}
Type G: Bankruptcy & Gone broke \tn 
% Row Count 6 (+ 1)
% Row 20
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{{\bf{Boot in a §368}}} \tn 
% Row Count 7 (+ 1)
% Row 21
\SetRowColor{LightBackground}
If shareholders receive boot & they recognize gain up to the lesser of boot received or realized gain \tn 
% Row Count 11 (+ 4)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Both the transferor corporation and the acquiring corporation recognize \$0 gain or loss in a qualifying reorganization.  \newline  \newline The gain is deferred into the new entity's basis and the shareholder's new stock basis.}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}

\begin{tabularx}{5.377cm}{x{2.33919 cm} x{2.63781 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{M-1, CC, DRD}}  \tn
% Row 0
\SetRowColor{LightBackground}
Schedule M-1 & reconciling book income to taxable income \tn 
% Row Count 2 (+ 2)
% Row 1
\SetRowColor{white}
ADDITIONS: & + Federal income tax per books \tn 
% Row Count 4 (+ 2)
% Row 2
\SetRowColor{LightBackground}
 & + Excess capital losses over capital gains \tn 
% Row Count 7 (+ 3)
% Row 3
\SetRowColor{white}
 & + Income reported for tax NOW but not in books (pre-paid) \tn 
% Row Count 10 (+ 3)
% Row 4
\SetRowColor{LightBackground}
 & + Expenses deducted in books but not for tax (excess charity) \tn 
% Row Count 13 (+ 3)
% Row 5
\SetRowColor{white}
SUBTRACTIONS: & − Income reported in books but excluded from tax (tax-exempt interest) \tn 
% Row Count 17 (+ 4)
% Row 6
\SetRowColor{LightBackground}
 & − Tax deductions not expensed in books (excess tax depreciation) \tn 
% Row Count 21 (+ 4)
% Row 7
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{Result: taxable income before NOL and DRD.} \tn 
% Row Count 22 (+ 1)
% Row 8
\SetRowColor{LightBackground}
Charitable contributions & 10\% of taxable income // Excess contributions carry over 5 years \tn 
% Row Count 26 (+ 4)
% Row 9
\SetRowColor{white}
taxable income calc not affected by: & (1) the charitable contribution deduction itself \tn 
% Row Count 29 (+ 3)
% Row 10
\SetRowColor{LightBackground}
 & (2) NOL or capital loss carrybacks \tn 
% Row Count 31 (+ 2)
\end{tabularx}
\par\addvspace{1.3em}

\vfill
\columnbreak
\begin{tabularx}{5.377cm}{x{2.33919 cm} x{2.63781 cm} }
\SetRowColor{DarkBackground}
\mymulticolumn{2}{x{5.377cm}}{\bf\textcolor{white}{M-1, CC, DRD (cont)}}  \tn
% Row 11
\SetRowColor{LightBackground}
 & (3) the DRD \tn 
% Row Count 1 (+ 1)
% Row 12
\SetRowColor{white}
\mymulticolumn{2}{x{5.377cm}}{Dividends received deduction (DRD)} \tn 
% Row Count 2 (+ 1)
% Row 13
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{Ownership \% → DRD \%:} \tn 
% Row Count 3 (+ 1)
% Row 14
\SetRowColor{white}
Less than 20\% → & 50\% \tn 
% Row Count 4 (+ 1)
% Row 15
\SetRowColor{LightBackground}
20\%–79\% → & 65\% \tn 
% Row Count 5 (+ 1)
% Row 16
\SetRowColor{white}
80\% or more → & 100\% \tn 
% Row Count 6 (+ 1)
% Row 17
\SetRowColor{LightBackground}
Step 1: & Dividends received × DRD \% \tn 
% Row Count 8 (+ 2)
% Row 18
\SetRowColor{white}
Step 2: & Taxable income (before DRD) × DRD \% \tn 
% Row Count 10 (+ 2)
% Row 19
\SetRowColor{LightBackground}
Step 3: & Deduction = lesser of Step 1 or Step 2 \tn 
% Row Count 12 (+ 2)
% Row 20
\SetRowColor{white}
EXCEPTION (NOL rule): & if using Step 1 creates an NOL, use Step 1 anyway. \tn 
% Row Count 15 (+ 3)
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\SetRowColor{LightBackground}
\mymulticolumn{2}{x{5.377cm}}{M-1 items — proceeds are tax-free (subtract), premiums are non-deductible (add). \newline  \newline Accrual basis corporations: may deduct in the year preceding payment if the board authorized the contribution by year-end AND payment is made by the 15th day of the 4th month after year-end \newline  \newline Stock must be held more than 45 days to claim the DRD.}  \tn 
\hhline{>{\arrayrulecolor{DarkBackground}}--}
\end{tabularx}
\par\addvspace{1.3em}


% That's all folks
\end{multicols*}

\end{document}