Identify Which of the Following Statements Is True

question 20

Multiple Choice

Identify which of the following statements is true.

• A)In practice, the accumulated earnings tax applies only to closely held corporations.
• B)A corporation bears the burden of proving that its earnings are not being accumulated to avoid income taxes.
• C)To avoid the accumulated earnings tax, a corporation needs to have a definite plan for expending the accumulated earnings.
• D)All of the above are true.