CORPORATE QUESTIONNAIRE
(and LLC’s taxed as a C or S Corporation)
Corporate Name:____________________________________
Corporate Type: ____________________________________
Using a corporate entity is an excellent way to save tax dollars, provide legal & financial protection, along with
several other benefits. However, to preserve these benefits you MUST follow all corporate rules and maintain
documentation. The following questionnaire will help you understand some of the corporate benefits available
and the requirements to qualify for these benefits.
General:
_____ Officers – If your officers have changed since we prepared your last tax return, please complete the
Listing of Officers (see attached information sheet).
New clients – please complete the information sheet included.
_____ Bylaws – Please provide us with a copy of your corporate bylaws, unless you already have.
_____ Corporate Minutes – Corporations are required to hold at least one annual meeting per year. The annual
meeting should document all decisions made by corporate management, such as the following (but is not
limited to):

Officer’s salary,

Purchase of equipment,

Decision to move corporate offices,

Approve loans to or from shareholders,

Implementation of employment benefit packages, health insurance, retirement plan,

Adoption of Accountable Plan – reimbursement of expenses paid by shareholders.
_____ Has Corporate Stock been issued?
Provide a list of shareholders, the number of shares held and their investment (see attached
information sheet).
_____ Have you filed the most recent Statement of Information for the State of California? This form is
required to be filed with the Secretary of State either annually or every two years with a fee of $25.
Please be aware of a third party filing service SCAMS. This form can be filed on line –
https://businessfilings.sos.ca.gov/. If this form is not filed on time, a $250 penalty will be assessed and
there is a possibility that your corporate status could be suspended.
Recordkeeping:
A CORPORATION is a separate entity from its shareholders – all transactions between a
CORPORATION and its shareholders must be at an “arms length” (would/could you complete the
transaction with someone else?). Therefore, it is very important that an accurate recordkeeping system is
maintained. A corporate tax return requires the information from a Profit & Loss Statement (showing
Corporate net profit was) AND a Balance Sheet (showing the corporate assets, liabilities and equity).
Both of these statements can be created using a double entry software package such as QuickBooks®. If
you don’t have a bookkeeper or you have questions about QuickBooks®, we highly recommend LT
Bookkeeping Services, Inc. Their phone number is 714-755-1013.
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Corporate Expenses:
_____ Do you use an automobile for corporate business? Please check the scenario that applies to your auto
expenses:
Automobile Expenses can be a large corporate expense. It is very important to maintain accurate records
to support the business use of the automobile. There are several acceptable methods to use and the
method you use will depend upon who actually owns the vehicle(s), the corporation or the shareholder.
The most common vehicle ownership is the shareholder.
_____ Shareholder owns the vehicle: ALL vehicle expenses (purchase or lease payment, gas, maintenance,
insurance, etc.) are paid by the owner of the vehicle (the shareholder). An Accountable Plan needs to be
adopted by the Board of Directors and documented in the corporate minutes. With this plan in place, the
shareholder (and any other employee) must submit a request for reimbursement of the expenses they
have incurred on behalf of the corporation. This reimbursement can be based on the “cents per mile” or
actual expense method (see below). SlackTax, Inc. or LT Bookkeeping can recommend appropriate
reimbursement forms.
_____ Corporation owns the vehicle: ALL vehicle expenses (purchase or lease payment, gas, maintenance,
insurance, etc.) are paid by the owner of the vehicle (the corporation). If a shareholder or employee uses
the vehicle for personal purposes (driving from home to the corporate office and back), the value of this
use must be reported as taxable income on the shareholder or employee’s Form W-2. SlackTax, Inc. or
LT Bookkeeping can assist you in determining that value.
_____ “Cents per Mile” Method: For 2012, the IRS has designated the cents per mile deduction as 55.5¢. If
you choose to use this method, all vehicle expenses are disregarded.
_____ Did you pay for corporate expenses with personal funds?
For the expenses to be deductible by the corporation, the shareholders/employees need to be reimbursed
for their payment of the corporate expenses. We have created a monthly shareholder/employee expense
reimbursement form that can be used for this procedure.
_____ Did you purchase a new (or used) vehicle this year? We will need to see the purchase contract.
Substantial depreciation deductions are available, however if the vehicle is sold or traded in before the
end of the normal depreciation period, or the business usage of the vehicle drops below 50%, some or all
of the depreciation taken must be recaptured.
_____ Did you lease a new (or used) vehicle this year? We will need to see the lease contract.
Officer’s Compensation
_____ Did you pay salaries or wages to all of the officers/shareholders who performed services for the
corporation?
Officers and shareholders need to be paid a “reasonable” salary for all services they perform for the
corporation. These wages are subject to payroll tax withholding (federal and state income tax
withholding, FICA, Medicare and State Disability Insurance. Quarterly payroll tax returns need to be
filed, along with year-end forms and W-2’s need to be issued. If you need a payroll service, we highly
recommend LT Bookkeeping Services, Inc. Their phone number is 714-755-1013.
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Shareholder Loans
_____ Did you loan money to your corporation?
If this loan(s) is considered a long term loan, a promissory note between the officer/shareholder should
be executed. This promissory note needs to specify a market interest rate and the terms as to how the
loan will be repaid.
_____ Did you borrow money from your corporation?
A corporation can loan money to an officer/shareholder. However, the IRS may reclassify the payment
as a taxable dividend or compensation if it determines the arrangement is not a bona fide loan. In order
to withstand IRS scrutiny, a loan must be properly structured, and must include a signed promissory
note with repayment schedule and market interest rate. Even with proper paperwork in place, if the
payment has characteristics of compensation or a dividend payment, the IRS can re-characterize it as a
taxable distribution to the officer/shareholder.
If these loans are payments to the officers/shareholders in lieu of salary, they need to be correctly
classified as payroll, with all the appropriate payroll tax deductions. (See Officer’s Compensation
above).
Payment of personal expenses from the corporate bank account will also be considered either
constructive dividends (not deductible by the corporation but taxable on the shareholder's personal
return). These expenses could include non business restaurant/travel expenses, non business auto
expenses, purchases from warehouse/grocery stores, retail stores, personal rent or mortgage payments,
etc. If you have any questions about these payments please contact us.
Charitable Contributions
_____ Were any charitable contributions made with corporate funds?
Charitable contributions made by a corporation are only deductible to the extent of 10% of the corporate
earnings. The non-deductible amount will be carried over to future years. If your corporation has a very
small profit or a loss, you might consider making these donations personally rather than through the
corporation.
If your corporation is an S-Corporation, any charitable contributions will NOT be deducted on your
corporate tax return. Due to the flow through aspect of an S-Corporation, all charitable deductions will
be entered on the K-1 and deducted from your personal tax return.
Health Insurance
_____ Did you pay for health insurance for your employees and for any shareholders?
If you are an S-Corporation, the health insurance and expenses for the shareholder CANNOT be
deducted on the corporation tax return. Instead, these premiums are treated as wages & salaries, with the
appropriate payroll taxes deducted. Then the premiums can be deducted on the shareholder's personal
return.
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Corporate Tax Return Due Date
Corporate tax returns must be filed (or an Application for Extension of Time to File) by the 15th day of
the third month following the close of its tax year. For a calendar year corporation, this deadline is
March 15. This deadline falls right in the middle of our personal income tax season, and since corporate
returns are much more complex than most personal tax returns we prefer to file for an extension of time
to file. The extension of time to file for a corporation is six months (until September 15 for calendar year
corporations). However, if you prefer to have your return filed by the March deadline, we need to have
this completed questionnaire, the Corporate Information Sheet, all requested information and a balanced
copy of your financial statements – Income Statement (Profit & Loss and Balance Sheet [QuickBooks®,
if possible]) no later than February 17, 2013.
_____ Would you like SlackTax, Inc. to request an Automatic Extension of Time to File which will
allow us more time spend on preparing your return?
Filing an Extension is AUTOMATIC for the filing of your return – But, if any taxes are due, they must
be paid by the original filing deadline – March 15, 2013. The request for an extension requires us to
make a good faith estimate of your tax liability. Please forward a copy of your financial statements,
record of estimated tax payments and any other information relevant to estimating your potential tax
liability to us for a quick review ASAP.
Late Filing Penalties
Corporate returns not filed by the due date (or extended due date) are subject to a late filing penalty of
5% of the unpaid balance per month, or part of a month, up to a maximum of 25%. A minimum penalty
for late filing, if the return is more than 60 days late (including extension) is the lesser of $135 or 100%
of the tax required to be shown on the return.
Taxes not paid by the due date of the return (no extension of time to pay is available) are subject to a
penalty of one half of one percent per month or part of a month, up to a maximum of 25%.
S Corporations and Partnerships - Schedule K-1 Partner's Share of Income, Deductions, Credits, etc not
filed by the due date (or extended due date) will be subject to a $195 penalty PER SHAREHOLDER OR
PARTNER PER MONTH!.
Miscellaneous Questions
_____ Has this corporation made any estimated tax payments for the current tax year? If so, please provide us
with the dates the payments were made and the amounts:
Date: ___________ Amount: ____________
Date: ____________ Amount:__________
Date: ___________
Amount: ____________
Date: ____________ Amount: _________
_____ Were any individuals paid more than $600 during the year for services performed for the corporation?
Were the appropriate Forms 1099-MISC issued by the due date of January 31?
_____ Did this corporation receive any dividends from another corporation? If yes, provide details.
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_____ At any time during the year, did this business have an interest in, a signature or other authority over a
financial account in a foreign country (such as a bank, securities or other financial account)? Please
note: these reporting requirements have been significantly expanded for 2012.
_____ Does this business have any foreign partners, members or shareholders? If yes, provide details.
_____ Did this business pay any taxes to a foreign government during the tax year?
_____ Did this business pay expenses to make the business accessible or usable by individuals with
disabilities?
_____ Is this business located in an empowerment zone or renewal community?
_____ During the current tax year, did this business hire any new employees from a targeted group?
_____ Did you hire a veteran as an employee?
_____ Did this business place in service a new hybrid vehicle during the year?
_____ Did this business have any debt cancelled or forgiven or have terms of any debt modified?
I have read and completed this organizer to the best of my knowledge. I understand that if I mark any items with
a YES answer or a ?, a tax professional with discuss this issue with me.
QUESTIONS FOR YOUR TAX PREPARER:
________________________________________
Signature
_________________ _________________
Title
Date
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