Identify Which of the Following Statements Is False

question 23

Multiple Choice

Identify which of the following statements is false.

• A) The Tax Court can be used to litigate a tax issue without first paying the tax assessment.
• B) In general, the taxpayer has the burden of proof in Tax Court cases. However, the IRS has the burden of proof for issues raised after the issuance of the 90- day letter.
• C) A taxpayer may want to avoid using the Tax Court to litigate an issue because decisions from this court cannot be appealed.
• D) In order to litigate in the Tax Court, a petition must be filed within 90 days of the issuance of a notice of deficiency.

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Definitions:

Cost of Equity

The return a company requires to decide if an investment meets capital return requirements, often used to assess the cost of funding projects.

Pre-Tax Cost

The expense incurred by a company or individual before taxes are deducted.

Levered Value

The value of an investment or company including debt, reflecting its total worth in a leveraged state.

Cost of Equity

The rate of return that a company must generate on equity-financed projects to retain its market value, reflecting the compensation investors expect for their risk.