Which of the Following Is Not a True Statement

question 49

Multiple Choice

Which of the following is not a true statement?

• A)For shareholder-employees who own 2 percent or less of the entity, the S corporation gets a tax deduction for qualifying fringe benefits, and the benefits are nontaxable to the employees.
• B)For shareholder-employees who own more than 2 percent of the S corporation, the S corporation gets a tax deduction, but the otherwise qualifying fringe benefits are taxable to the shareholder-employees who own more than 2 percent.
• C)S corporation ownerswho also work for the S corporation have a tax incentive to pay themselves a low salary.
• D)An S corporation shareholder's allocable share of ordinary business income (loss)is not classified as self-employment income for tax purposes.
• E)None of the choices are false.

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Definitions:

Sinus Arrhythmia

A naturally occurring variation in heart rate that occurs during a breathing cycle, typically considered normal.

Sphygmomanometer

A device used to measure blood pressure, typically consisting of an inflatable cuff, a measuring unit (either mercury or aneroid), and a mechanism for inflation which may be manual or automatic.

False High

An inaccurately elevated measurement or reading, often due to procedural or equipment errors.

Hemoglobin

A protein in red blood cells responsible for carrying oxygen from the lungs to the rest of the body.