Various Members of Congress Favor a Reduction in the Corporate

question 146

Multiple Choice

Various members of Congress favor a reduction in the corporate tax rate to improve competitiveness and have proposed legislation to lower corporate income tax rates.Assume the legislation is enacted,and corporate tax rates are reduced.If a C corporation,which normally generates taxable income of $300,000 or higher and has expectations of higher profits in the future,generates an NOL in the current year,how would you recommend the corporation apply the loss?

• A)The corporation should carry back the loss two years and claim a refund.
• B)The corporation should elect to carry forward the loss to the next year.
• C)The corporation is required to carry forward the loss to the next year.
• D)The corporation cannot apply a loss to another year.

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Definitions:

Low Risk

Low risk describes investments or decisions that have a minimal chance of losing value or causing harm.

Insurance With Deductibles

A type of insurance policy where the policyholder is required to pay a specified amount of loss before the insurance coverage begins paying out.

Low-Risk Individuals

People who are considered to have a lower probability of experiencing adverse events or making claims, often used in the context of insurance underwriting and premium setting.

Co-payments

Fixed amounts paid by an insured person for receiving specific health care services, with the insurance covering the remainder of the costs.