Question

The post-termination transition period (PTTP) for an S corporation ends:

a. On the last day of the calendar year of termination
b. On the last day of the tax year of termination
c. One year after the termination date
d. Two years after the termination date

Answer 1

The post-termination transition period for an S corporation ends one year after the termination date, allowing certain actions under S corporation status.

Step-by-step explanation:

The post-termination transition period (PTTP) for an S corporation ends one year after the termination date. This means that, in response to the multiple-choice question, the correct answer is (c) One year after the termination date. The PTTP is a timeframe during which a corporation that has terminated its S election may still take certain actions as if it were an S corporation, such as distributing its previously taxed income.