Assume a Corporation Is Not Required to Pay AMT in the Current

question 15

Multiple Choice

Assume a corporation is not required to pay AMT in the current year but will pay AMT next year. Also assume the corporation's regular marginal tax rate is 35%. Which tax planning strategy would minimize its after-tax cost of a charitable contribution it is considering paying to a qualified charity?

• A) The after-tax cost of the contribution will be the same no matter which year it makes the contribution.
• B) Pay the contribution this year.
• C) Wait until next year to pay the contribution.
• D) None of the choices are correct.

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Definitions:

Parliament

The supreme legislative body in many countries, including the United Kingdom, consisting of elected representatives who have the power to make laws.

Colonial Possessions

Territories that were owned or controlled by a foreign sovereign or nation, particularly during the era of European imperialism and colonization from the 15th to 20th centuries.

Townshend Acts

A series of British laws passed in the late 1760s taxing American colonists on imported goods like paper, tea, glass, and paint, leading to widespread protest.

Women

Female human beings, making up approximately half of the global population, with diverse roles and contributions in society, culture, economy, and family life.