CTA Business Taxation 2

Question 1

Which IRC Section allows small businesses to immediately expense the cost of qualifying property rather than depreciate it over time?

Accepted Answer

Section 179

Answer

Section 168

Answer

Section 197

Answer

Section 280F

Question 2

What is the purpose of Schedule K-1 in partnership taxation?

Accepted Answer

To allocate each partner's distributive share of income, deductions, and credits

Answer

To report payroll tax deposits

Answer

To calculate the partnership's self-employment tax

Answer

To report the partnership's total gross receipts

Question 3

Which of the following expenses is generally NOT deductible for a C corporation?

Accepted Answer

Dividends paid to shareholders

Answer

Ordinary business expenses

Answer

Employee salaries

Answer

Business-related travel

Question 4

What is the corporate alternative minimum tax (CAMT) rate introduced by the Inflation Reduction Act?

Accepted Answer

15%

Answer

10%

Answer

12%

Answer

20%

Question 5

Under the MACRS system, what is the recovery period for 5-year property (e.g., automobiles, computers)?

Accepted Answer

5 years

Answer

3 years

Answer

7 years

Answer

10 years

Question 6

Which of the following business entities provides limited liability protection to all owners while being taxed as a partnership by default?

Accepted Answer

Limited liability company (LLC)

Answer

General partnership

Answer

C corporation

Answer

Sole proprietorship