Browse Arkansas Code titles and sections
26 U.S.C. § 1378 — Taxable year of S corporation
Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** For purposes of this subtitle, the taxable year of an S corporation shall be a permitted year.
**(b) Permitted year defined** For purposes of this section, the term “permitted year” means a taxable year which—
(1) is a year ending December 31, or
(2) is any other accounting period for which the corporation establishes a business purpose to the satisfaction of the Secretary.
For purposes of paragraph (2), any deferral of income to shareholders shall not be treated as a business purpose.
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1378
Stored review status: release_metadata_unconfirmed. A text match is a research starting point; applicability is not established.
Original supplied file — preserved unchanged
Download original Markdown file
File SHA-256: 2e622e495b359b4f48afa251f8d3b9fc7e1bdd821f131cadd5872f4032d629f7. The original may include catalog metadata, neighboring provisions, or embedded records outside this collection's scope. Search shows only the selected federal record. Historical editions and unverified snapshots are not a statement of current law.
Authority boundary: historical or unconfirmed source not current law verified.
Open the recorded source website ↗
Record provenance
Stable record: federal_law:legal_authorities:record_usc_c6ab3dc6f5701e748be6352d
Source file: Laws/federal/codes/united-states-code/title-26/section-1378-taxable-year-of-s-corporation--723f4d7419.md
Pages: Not recorded – Not recorded
Passage SHA-256: 3b8db008f0754c1cb345898e7e7212304a22cba5f722b5effd355fdec2270e30
Source location: Title 26, Chapter 1, § 1378; chapter-001-normal-taxes-and-surtaxes.md
Stored source content
**(a) General rule** For purposes of this subtitle, the taxable year of an S corporation shall be a permitted year.
**(b) Permitted year defined** For purposes of this section, the term “permitted year” means a taxable year which—
(1) is a year ending December 31, or
(2) is any other accounting period for which the corporation establishes a business purpose to the satisfaction of the Secretary.
For purposes of paragraph (2), any deferral of income to shareholders shall not be treated as a business purpose.
Cross-references
Connections may be documented source relationships, shared citations or nearby passages. Each explains its basis; a connection alone does not establish applicability to your situation.
Federal law — U.S. Code and appendices · legal_authorities
**(a) S corporation defined**
(1) **In general** — For purposes of this title, the term “S corporation” means, with respect to any taxable year, a small business corporation for which an election under section 1362(a) is in effect for such year.
(2) **C corporation** — For purposes of this title, the term “C corporation” means, with respect to any taxable year, a corporation which is not an S corporation for such year.
**(b) Small business corporation**
(1) **In general** — For purposes of this subchapter, the term “small business corporation” means a domestic corporation which is not an ineligible corporation and which does not—
(A) have more than 100 shareholders,
(B) have as a shareholder a person (other than an estate, a trust described in subsection (c)(2), or an organization described in subsection (c)(6)) who is not an individual,
(C) have a nonresident alien as a shareholder, and
(D) have more than 1 class of stock.
(2) **Ineligible corporation defined** — For purposes of paragraph (1), the term “ineligible corporation” means any corporation which is—
(A) a financial institution which uses the reserve method of accounting for bad debts described in section 585,
(B) an insurance company subject to tax under subchapter L, or
(C) a DISC or former DISC.
(3) **Treatment of certain wholly owned subsidiaries**
(A) *In general* — Except as provided in regulations prescribed by the Secretary, for purposes of this title—
(i) a corporation which is a qualified subchapter S subsidiary shall not be treated as a separate corporation, and
(ii) all assets, liabilities, and items of income, deduction, and credit of a qualified subchapter S subsidiary shall be treated as assets, liabilities, and such items (as the case may be) of the S corp
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1361
Stored review status: release_metadata_unconfirmed. Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) In general**
(1) **Deduction for losses disallowed** — No deduction shall be allowed in respect of any loss from the sale or exchange of property, directly or indirectly, between persons specified in any of the paragraphs of subsection (b). The preceding sentence shall not apply to any loss of the distributing corporation (or the distributee) in the case of a distribution in complete liquidation.
(2) **Matching of deduction and payee income item in the case of expenses and interest** — If—
(A) by reason of the method of accounting of the person to whom the payment is to be made, the amount thereof is not (unless paid) includible in the gross income of such person, and
(B) at the close of the taxable year of the taxpayer for which (but for this paragraph) the amount would be deductible under this chapter, both the taxpayer and the person to whom the payment is to be made are persons specified in any of the paragraphs of subsection (b),
then any deduction allowable under this chapter in respect of such amount shall be allowable as of the day as of which such amount is includible in the gross income of the person to whom the payment is made (or, if later, as of the day on which it would be so allowable but for this paragraph). For purposes of this paragraph, in the case of a personal service corporation (within the meaning of section 441(i)(2)), such corporation and any employee-owner (within the meaning of section 269A(b)(2), as modified by section 441(i)(2)) shall be treated as persons specified in subsection (b).
(3) **Payments to foreign persons**
(A) *In general* — The Secretary shall by regulations apply the matching principle of paragraph (2) in cases in which the person to whom the payment is to be made is not a United States person.
(B) *Spe
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 267
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) Computation of taxable income** Taxable income shall be computed on the basis of the taxpayer’s taxable year.
**(b) Taxable year** For purposes of this subtitle, the term “taxable year” means—
(1) the taxpayer’s annual accounting period, if it is a calendar year or a fiscal year;
(2) the calendar year, if subsection (g) applies;
(3) the period for which the return is made, if a return is made for a period of less than 12 months; or
(4) in the case of a DISC filing a return for a period of at least 12 months, the period determined under subsection (h).
**(c) Annual accounting period** For purposes of this subtitle, the term “annual accounting period” means the annual period on the basis of which the taxpayer regularly computes his income in keeping his books.
**(d) Calendar year** For purposes of this subtitle, the term “calendar year” means a period of 12 months ending on December 31.
**(e) Fiscal year** For purposes of this subtitle, the term “fiscal year” means a period of 12 months ending on the last day of any month other than December. In the case of any taxpayer who has made the election provided by subsection (f) the term means the annual period (varying from 52 to 53 weeks) so elected.
**(f) Election of year consisting of 52–53 weeks**
(1) **General rule** — A taxpayer who, in keeping his books, regularly computes his income on the basis of an annual period which varies from 52 to 53 weeks and ends always on the same day of the week and ends always—
(A) on whatever date such same day of the week last occurs in a calendar month, or
(B) on whatever date such same day of the week falls which is nearest to the last day of a calendar month,
may (in accordance with the regulations prescribed under paragraph (3)) elect to compute his taxable inc
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 441
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
For purposes of section 38, the amount of the investment credit determined under this section for any taxable year shall be the sum of—
(1) the rehabilitation credit,
(2) the energy credit,
(3) the qualifying advanced coal project credit,
(4) the qualifying gasification project credit,
(5) the qualifying advanced energy project credit,
(6) the advanced manufacturing investment credit, and
(7) the clean electricity investment credit.
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 46
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) Definitions** For purposes of this subtitle, the term “common trust fund” means a fund maintained by a bank—
(1) exclusively for the collective investment and reinvestment of moneys contributed thereto by the bank in its capacity—
(A) as a trustee, executor, administrator, or guardian, or
(B) as a custodian of accounts—
(i) which the Secretary determines are established pursuant to a State law which is substantially similar to the Uniform Gifts to Minors Act as published by the American Law Institute, and
(ii) with respect to which the bank establishes, to the satisfaction of the Secretary, that it has duties and responsibilities similar to duties and responsibilities of a trustee or guardian; and
(2) in conformity with the rules and regulations, prevailing from time to time, of the Board of Governors of the Federal Reserve System or the Comptroller of the Currency pertaining to the collective investment of trust funds by national banks.
For purposes of this subsection, two or more banks which are members of the same affiliated group (within the meaning of section 1504) shall be treated as one bank for the period of affiliation with respect to any fund of which any of the member banks is trustee or two or more of the member banks are cotrustees.
**(b) Taxation of common trust funds** A common trust fund shall not be subject to taxation under this chapter and for purposes of this chapter shall not be considered a corporation.
**(c) Income of participants in fund** Each participant in the common trust fund in computing its taxable income shall include, whether or not distributed and whether or not distributable—
(1) as part of its gains and losses from sales or exchanges of capital assets held for not more than 1 year, its proportionate share of
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 584
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) In general** For purposes of this subtitle, the taxable year of any trust shall be the calendar year.
**(b) Exception for trusts exempt from tax and charitable trusts** Subsection (a) shall not apply to a trust exempt from taxation under section 501(a) or to a trust described in section 4947(a)(1).
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 644
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) Year in which partnership income is includible** In computing the taxable income of a partner for a taxable year, the inclusions required by section 702 and section 707(c) with respect to a partnership shall be based on the income, gain, loss, deduction, or credit of the partnership for any taxable year of the partnership ending within or with the taxable year of the partner.
**(b) Taxable year**
(1) **Partnership’s taxable year**
(A) *Partnership treated as taxpayer* — The taxable year of a partnership shall be determined as though the partnership were a taxpayer.
(B) *Taxable year determined by reference to partners* — Except as provided in subparagraph (C), a partnership shall not have a taxable year other than—
(i) the majority interest taxable year (as defined in paragraph (4)),
(ii) if there is no taxable year described in clause (i), the taxable year of all the principal partners of the partnership, or
(iii) if there is no taxable year described in clause (i) or (ii), the calendar year unless the Secretary by regulations prescribes another period.
(C) *Business purpose* — A partnership may have a taxable year not described in subparagraph (B) if it establishes, to the satisfaction of the Secretary, a business purpose therefor. For purposes of this subparagraph, any deferral of income to partners shall not be treated as a business purpose.
(2) **Partner’s taxable year** — A partner may not change to a taxable year other than that of a partnership in which he is a principal partner unless he establishes, to the satisfaction of the Secretary, a business purpose therefor.
(3) **Principal partner** — For the purpose of this subsection, a principal partner is a partner having an interest of 5 percent or more in partnership profits or c
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 706
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** This section applies to a partnership or S corporation for any taxable year, if—
(1) an election under section 444 is in effect for the taxable year, and
(2) the required payment determined under subsection (b) for such taxable year (or any preceding taxable year) exceeds $500.
**(b) Required payment** For purposes of this section, the term “required payment” means, with respect to any applicable election year of a partnership or S corporation, an amount equal to—
(1) the excess of the product of—
(A) the applicable percentage of the adjusted highest section 1 rate, multiplied by
(B) the net base year income of the entity, over
(2) the net required payment balance.
For purposes of paragraph (1)(A), the term “adjusted highest section 1 rate” means the highest rate of tax in effect under section 1 as of the end of the base year plus 1 percentage point (or, in the case of applicable election years beginning in 1987, 36 percent).
**(c) Refund of payments**
(1) **In general** — If, for any applicable election year, the amount determined under subsection (b)(2) exceeds the amount determined under subsection (b)(1), the entity shall be entitled to a refund of such excess for such year.
(2) **Termination of elections, etc.** — If—
(A) an election under section 444 is terminated effective with respect to any year, or
(B) the entity is liquidated during any year, the entity shall be entitled to a refund of the net required payment balance.
(3) **Date on which refund payable** — Any refund under this subsection shall be payable on the later of—
(A) April 15 of the calendar year following—
(i) in the case of the year referred to in paragraph (1), the calendar year in which it begins,
(ii) in the case of the year referred to in
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 7519
Stored review status: release_metadata_unconfirmed. Incoming connection: Explicit cross-reference supplied in source Markdown; currentness and applicability require review.
Federal law — U.S. Code and appendices · legal_authorities
Page 2467
TITLE 26—INTERNAL REVENUE CODE
§ 1378
during the taxable year and all affected
shareholders and the corporation agree to
the application of this paragraph, paragraph
(1) shall be applied to the affected share-
holders as if the taxable year consisted of 2
taxable years the first of which ends on the
date of the termination.
(B) Affected shareholders
For purposes of subparagraph (A), the term
‘‘affected shareholders’’ means the share-
holder whose interest is terminated and all
shareholders to whom such shareholder has
transferred shares during the taxable year. If
such shareholder has transferred shares to
the corporation, the term ‘‘affected share-
holders’’ shall include all persons who are
shareholders during the taxable year.
(b) Post-termination transition period
(1) In general
For purposes of this subchapter, the term
‘‘post-termination transition period’’ means—
(A) the period beginning on the day after
the last day of the corporation’s last taxable
year as an S corporation and ending on the
later of—
(i) the day which is 1 year after such last
day, or
(ii) the due date for filing the return for
such last year as an S corporation (includ-
ing extensions),
(B) the 120-day period beginning on the
date of any determination pursuant to an
audit of the taxpayer which follows the ter-
mination of the corporation’s election and
which adjusts a subchapter S item of in-
come, loss, or deduction of the corporation
arising during the S period (as defined in
section 1368(e)(2)), and
(C) the 120-day period beginning on the
date of a determination that the corpora-
tion’s election under section 1362(a) had ter-
minated for a previous taxable year.
(2) Determination defined
For purposes of paragraph (1), the term ‘‘de-
termination’’ mea
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 1378
Stored review status: historical_2024_not_currentness_verified. Same stored citation; legal effect and authority still require review.