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MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2342
Experience:  CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
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A C Corp invests nearly all of its earnings in brokerage

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A C Corp invests nearly all of it's earnings in brokerage accounts and other investments during the fiscal year. Is the taxable amount for the year only earnings left in the C Corp that were not invested? In other words, since the C Corp invested most of its earnings, is there minimal taxes due?
Hi and welcome to JustAnswer:

The C corp is taxed on ALL of its earnings less allowable deductions. Investment in securities is not an allowable deduction, but just a change in form or assets.
Customer: replied 3 years ago.

Are there any investment catagories that qualify as deductions or that would delay taxes due such as real estate or precious metals or other commodities?

Hi -

There are no investments that would directly qualify as deductions. If you were to invest in rental real estate, you would be able to depreciate the building portion of the investment over 27.5 or 39 years. (Ex: R/E purchase $100K, Building $80K, Land $20K, depreciation for a full year's ownership would be $2,909 or $2,051) Not exactly a major current tax deduction. Investment in precious metals, commodities or any personal property (antiques, cars, etc) are just that, investments.

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