Which of the Following Statements Is False Regarding Consolidated Tax

question 101

Multiple Choice

Which of the following statements is false regarding consolidated tax returns?

• A)An affiliated group can file a consolidated tax return only if it elects to do so.
• B)To file a consolidated tax return, one corporation must own 50percent or more of the stock of another corporation.
• C)For a group of corporations filing a consolidated tax return, an advantage is that losses of one group member may offset gains of another group member.
• D)For a group of corporations filing a consolidated tax return, losses from certain intercompany transactions are deferred until realized through a transaction outside of the group.

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Definitions:

Social Identity Theory

A psychological theory that examines how an individual’s self-concept is derived from perceived membership in social groups, influencing intergroup behavior.

Collective Behavior

Activities and behaviors of a group of people who are in a state of shared excitement or concern, often leading to unconventional behavior.

Ingroup

Represents a group to which a person belongs, feels a sense of identity with, and tends to favor over outgroups, which can influence perceptions and behaviors.

Outgroup

A group to which an individual does not belong and is often perceived as fundamentally different or opposed to the ingroup, leading to potential bias or prejudice.