Identify Which of the Following Statements Is False

question 47

Multiple Choice

Identify which of the following statements is false.

• A) An individual taxpayer, who is assessed an additional payment of money based on stock ownership in a corporation whose stock is redeemed in a complete liquidation, may recognize a capital loss to the extent of the additional assessment.
• B) The open transaction doctrine defers the shareholder's gain or loss from a liquidation until the assets can be valued by sale or collection.
• C) The IRS asserts that the open transaction doctrine should be used only in extraordinary circumstances.
• D) The open transaction doctrine as applied to complete corporate liquidations refers to the numerous planning alternatives available when liquidating a corporation.

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Definitions:

Less Dense Crust

Refers to the Earth's continental crust, which is less dense than oceanic crust, allowing it to float higher on the mantle.

Continental Crust

The dense segment of the Earth's crust responsible for the formation of big terrestrial masses, which is usually more ancient and complex compared to the oceanic crust.

Oceanic Crust

The thin layer of the Earth's crust that underlies the ocean basins, composed mainly of basalt.

Mantle

The layer of the Earth located between the crust and the outer core, composed of silicate rocks rich in iron and magnesium.