A Taxpayer Can Avoid a Substantial Understatement of Tax Penalty

question 50

Multiple Choice

A taxpayer can avoid a substantial understatement of tax penalty:

• A)if the position is frivolous and disclosed on the tax return.
• B)if the position has a realistic possibility of being sustained by the IRS or courts.
• C)if there is substantial authority to support the position.
• D)if the position has a reasonable basis and is not disclosed on the tax return.
• E)None of the choices are correct.

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Definitions:

Closer To Extinction

A state or condition where a species is at greater risk of ceasing to exist.

Private Property

The legal right that allows individuals to own, use, and transfer objects, land, and intellectual property.

Resource's Current Price

The current market price at which a specific resource is traded.

Extraction

The process of removing or obtaining a substance from a mixture or compound by chemical or physical means.