SEE Part 2

Part 2: Businesses

Business entities, sole proprietorships, partnerships, corporations, S corporations, deductions, depreciation, payroll, basis, credits, and specialized business topics.

Expanded study bank

This course currently includes 500 study questions for Part 2: Businesses, with explanations, topic labels, difficulty labels, and review metadata.

Last reviewed: May 30, 2026. Tax year covered: Current IRS SEE cycle; verify current tax-year dollar limits before testing.

Tax rules, limits, forms, fees, and exam logistics can change. Always verify current tax-year limits, exam fees, scheduling rules, and identification requirements with official IRS and PSI sources before testing.

Business Entities and Tax Considerations

Compare tax treatment for sole proprietorships, partnerships, corporations, S corporations, LLCs, trusts, estates, and exempt organizations.

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Sole Proprietorships

Report business income and expenses, self-employment tax, home office, vehicle use, and Schedule C issues.

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Partnerships

Apply partnership formation, income allocation, guaranteed payments, basis, liabilities, distributions, and partner reporting rules.

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Corporations

Analyze C corporation income, deductions, dividends, earnings and profits, tax payments, and return filing requirements.

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S Corporations

Apply eligibility, elections, shareholder basis, reasonable compensation, distributions, losses, and termination rules.

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LLC Tax Classification

Determine default and elected classification for single-member and multi-member LLCs.

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Business Income and Expenses

Classify ordinary and necessary business expenses, capitalization, meals, travel, interest, bad debts, and limitations.

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Depreciation, Amortization, and Section 179

Apply cost recovery concepts, placed-in-service rules, listed property, Section 179, bonus depreciation, and amortization.

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Payroll and Employment Taxes

Identify worker classification, withholding, deposits, Forms 940 and 941, FUTA, FICA, and employment-tax penalties.

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Business Credits

Recognize common business credits, eligibility limits, carrybacks, carryforwards, and documentation requirements.

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Accounting Methods and Periods

Apply cash/accrual concepts, inventory rules, accounting periods, and method-change procedures.

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Basis, Distributions, and Loss Limitations

Compute basis and loss limits for entities, including at-risk, passive activity, stock, debt, and partnership basis concepts.

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Farm Taxation

Recognize farm income, expenses, inventories, depreciation, special elections, and estimated-tax rules.

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Estates and Trusts

Understand fiduciary income-tax concepts, DNI, distributions, beneficiaries, and filing obligations at an exam level.

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Exempt Organizations

Identify exempt organization filing, unrelated business income, private benefit, and compliance issues.

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Retirement Plans

Recognize business retirement plan deductions, contribution timing, plan types, and employer responsibilities.

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International Business Issues

Identify business-related foreign reporting, withholding, sourcing, and entity issues at an exam level.

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Final Review and Practice Exams

Review mixed business scenarios, entity comparison, basis, timing, and calculation traps.

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