Which of the Following Is Not a Tax Preference Item

question 69

Multiple Choice

Which of the following is not a tax preference item for purposes of the alternative minimum tax?

• A) Percentage depletion in excess of the adjusted basis in property
• B) Amortized circulation costs
• C) Excess intangible drilling costs
• D) Tax-exempt interest on certain private activity bonds
• E) All of the above are tax preference items

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Definitions:

Progressive Tax System

A taxation system in which the tax rate increases as the taxable amount increases, leading to higher earners paying a larger percentage of their income in taxes than lower earners.

Government Expenditures

The total amount of money spent by the government on various services and projects, including healthcare, education, and infrastructure.

Major Expenditure

Large financial spending, often on significant items or services, that represents a considerable portion of an entity's budget.

Sales Tax

A tax imposed by governments on the sale of goods and services, added to the retail price.