What does separately stated item mean on the CPA exam?
Separately stated item. Income, deduction or credit that keeps its own character as it passes through to the owner, because the owner's own situation decides how it is taxed. Everything else is folded into ordinary business income.
Defined against Sec. 702(a).
Which CPA exam sections use separately stated item?
Separately stated item appears in the TCP section of the CPA exam.
Related terms
- dividends-received deduction: A deduction that keeps corporate profit from being taxed three times as it passes between corporations.
- ordinary income: Income taxed at the regular graduated rates rather than at preferential capital gain rates.
- deferred tax liability: The deferred tax consequences of taxable temporary differences: income already in the books that the return has not taxed yet, or a deduction taken on the return ahead of the books.
- qualified business income: The net income from a domestic pass-through trade or business, excluding investment income and reasonable compensation.
- trade or business: An activity carried on regularly, continuously and with a profit motive.
- nonresident alien: An individual who is neither a United States citizen nor a resident under the green card or substantial presence tests.