If a Taxpayer Operates an Illegal Business, No Deductions Are

question 104

True/False

If a taxpayer operates an illegal business, no deductions are permitted.

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Definitions:

Illegal Agreement

An agreement that is against the law, and therefore unenforceable by the parties involved.

Exculpatory Clause

A contract provision that relieves one party from liability for harm caused during the execution of the contract.

Tort Liability

Legal responsibility arising from a civil wrong that causes harm or loss to an individual or property, not based on contracts.

Illegal Agreements

Contracts or arrangements that are prohibited by law and thus are not enforceable by the judicial system.