Question: 1. Can shareholders of a C corporations deduct its losses against corporation's E&P passed to its shareholders as dividends (i.e. income of shareholders)?
2. When can a C (regular) corporation's corporate veil be pierced resulting in its shareholders being personally liable for corporation's actions?
3. How is the income of the following business entities taxed?
• Sole proprietorship
• C (regular) corporation
• Partnership
• Limited liability corporation (LLC)
• S corporation
4. Kent and Craig, who want to start a horse-training business, spoke to an insurance agent about getting insurance to cover potential liabilities, but were told that they could not get liability insurance because of the high risk nature their proposed business. What business entities would you recommend to Kent and Craig? Why?