Local Property Taxes Are a

question 125

Multiple Choice

Local property taxes are a

• A)Regressive tax because poorer people spend a larger portion of their income on property taxes.
• B)Progressive tax because as income increases people tend to buy more expensive houses.
• C)Progressive tax because the total tax on housing increases as the price of the house increases.
• D)Proportional tax because properties are taxed at the same rate regardless of the value of the home.

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Definitions:

Trade or Business

Trade or Business refers to any activity conducted for profit or livelihood, including goods and services production, buying, selling, or providing services.

Ordinary Loss

A loss incurred in the regular operation of a business or the sale of assets used in the business that can be fully deducted in the year it occurs.

Capital Loss

The loss incurred when a capital asset is sold for less than its purchase price.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, reflecting wear and tear or obsolescence.