Controlled Foreign Corporations (CFC) Will Not Be Taxed on Their

question 61

Multiple Choice

Controlled foreign corporations (CFC) will not be taxed on their foreign income currently if:

• A) the foreign tax rate is less than 90% of the U.S. corporate income tax rate.
• B) Subpart F income is less than 70% of the CFC's total income.
• C) Subpart F income is less than 5% of the CFC's total income.
• D) None of the above

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Definitions:

Declining Prices

A situation where prices of goods, securities, or commodities decrease over time due to various factors like market oversupply, low demand, or economic downturns.

Net Income

The amount of profit left over, after all expenses and taxes have been subtracted from total revenue.

Performance Bonuses

Performance bonuses are additional compensation provided to employees as a reward for achieving or surpassing predefined performance targets.

Inventory Cost Formula

Methods used to calculate the cost of inventory sold or on hand, such as FIFO (First In, First Out), LIFO (Last In, First Out), or weighted average.