Which of the Following Is Not a True Statement

question 85

Multiple Choice

Which of the following is not a true statement?

• A) An S corporation shareholder's allocable share of ordinary business income (loss) is not classified as self-employment income for tax purposes.
• B) S corporation owners have a tax incentive to pay themselves a low salary.
• C) For shareholder-employees who own more than 2 percent of the S corporation, the S corporation gets a tax deduction, but the otherwise qualifying fringe benefits are taxable to the more-than-2-percent shareholder-employees.
• D) For shareholder-employees who own 2 percent or less of the entity, the S corporation gets a tax deduction for qualifying fringe benefits, and the benefits are nontaxable to the employees.
• E) None of the choices are false.

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Definitions:

Increase Efficiency

The process of improving the effectiveness and productivity of operations, often by optimizing resources and reducing waste.

Chemistry

The science that deals with the properties, composition, and structure of substances, the transformations they undergo, and the energy released or absorbed during these processes.

Less-Developed Countries

Countries with low levels of industrialization, underdeveloped agricultural sectors, and lower standards of living and Human Development Index (HDI) scores compared to more developed countries.

Waste Resources

Materials that are not productively used and are discarded or are considered to be of no economic value.