Identify Which of the Following Statements Is True

question 28

Multiple Choice

Identify which of the following statements is true.

• A)A parent corporation cannot liquidate a subsidiary corporation (having but a single class of stock)and avoid recognizing its realized gain unless the parent corporation owns at least 80% of the subsidiary's stock.
• B)The liquidation of a subsidiary corporation must be completed within one tax year to receive nonrecognition treatment.
• C)The provisions permitting a tax-free liquidation of a subsidiary corporation apply to both corporate and noncorporate shareholders of the subsidiary.
• D)All of the above are false.

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Definitions:

Erect

To construct, build up, or establish something in an upright position.

Fence

A structure serving as an enclosure, barrier, or boundary, typically made out of wire, wood, or other materials.

Tender Of Performance

An offer by one party to perform their obligations under a contract, in accordance to the contract's terms.

Conditional

Depending on or subject to one or more conditions or requirements being met; not absolute.