Identify Which of the Following Statements Is False

question 71

Multiple Choice

Identify which of the following statements is false.

• A)A conduit approach-that is, the income has the same character in the hands of the beneficiary as it has to the trust-governs for fiduciary income taxation.
• B)Essentially, an estate or trust is taxed on any income it earns, whether retained or distributed.
• C)Many of the same rules that determine the calculation of taxable income for individuals apply to trusts.
• D)Trusts receive a personal exemption.

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Definitions:

FICA Taxes

Taxes imposed on both employees and employers to fund Social Security and Medicare, based on a percentage of the employees' wages.

SUTA Taxes

State Unemployment Tax Act taxes that employers pay to provide unemployment benefits to workers who lose their jobs.

FUTA Taxes

Federal unemployment taxes employers must pay, contributing to the US government's fund to support those unemployed.

Current Liability

A company's debt or obligations that are due within one year.