The Accounting Review Vol. 26 No. 3 1951
EXCESS PROFITS TAX MINUS ITS TECHNICALITIES.
Abstract
The excess profits credit based on record of earnings and the excess profits credit, based on invested capital are fraught with variations applicable to different circumstances as to require individual treatment according to the individual case. The basic questions being asked daily relate in great measure to the numerous corporations which will be free from excess profits tax under the 1950 act. However, management needs an understandable explanation of why a corporation must file an excess profits tax return even though it has no such tax to pay. It needs to know what keeps the corporation free of such tax, and how high its current earnings can climb before incurring a liability. The following description applies to the multifarious small corporations whose incomes in the base period 1946, 1947, 1948, and 1949 did not exceed $30,000.00 a year and whose equity and borrowed capital does not exceed $200,000.00. If such corporations come into the advantageous position of having current net income considerably in excess of the $25,000.00, then their officers may have some guidance from this article, but should rely on tax advice patterned to fit the actual circumstances, using the information herein contained for approximations only.
- DOI
- 10.2308/tar-7074635
- Volume
- 26
- Issue
- 3
- Pages
- 384-386
- Language
- en
- Sources
- crossref openalex