Identify Which of the Following Statements Is True

question 62

Multiple Choice

Identify which of the following statements is true.

• A)Shareholders who acquire stock in an S corporation after the election date and prior to the election's effective date must consent to the election.
• B)S corporation consent by shareholders is binding on the current tax year and all future tax years.
• C)Only shareholders who own stock on the date an S election takes effect must consent to the election.
• D)All of the above are false.

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Definitions:

Incentive Function

The role of incentives in influencing the behavior and decisions of individuals or organizations.

Competitive Markets

Markets characterized by a large number of buyers and sellers, where no single entity controls the market prices.

Resource

Any physical or virtual entity of limited availability that needs to be consumed to obtain a benefit, including natural resources, human resources, and financial resources.