Which of the Following Statements Regarding Controlled Foreign Corporations Is

question 72

Multiple Choice

Which of the following statements regarding controlled foreign corporations is true?

• A) U.S. shareholders are taxable on any income earned by a controlled foreign corporation.
• B) U.S. shareholders are never taxable on income earned by a controlled foreign corporation until such income is distributed to the shareholders.
• C) U.S. shareholders of a controlled foreign corporation can increase their basis by the amount of any constructive distributions from the corporation.
• D) Controlled foreign corporations are taxable in the United States on their worldwide income.