Olaf, a Citizen of Norway with No Trade or Business

question 48

Multiple Choice

Olaf, a citizen of Norway with no trade or business activities in the United States, sells at a gain 200 shares of MicroShift, Inc., a U.S. company. The sale takes place through Olaf's broker in Oslo. How is this gain treated for U.S. tax purposes?

• A) It is foreign-source income subject to U.S. taxation.
• B) It is foreign-source income not subject to U.S. taxation.
• C) It is U.S.-source income subject to U.S. taxation.
• D) It is U.S.-source income exempt from U.S. taxation.

---

Definitions:

Chemical Bonds

The attraction between atoms that allows the formation of chemical substances containing two or more atoms.

Contact Digestion

The process by which nutrients are broken down in the small intestine where enzymes directly act on the food.

Brush Border

Epithelial surface consisting of microvilli.

Segmental Contractions

Segmental contractions refer to the rhythmic contraction and relaxation of segments of the intestines, aiding in the mixing and absorption of nutrients.