Which of the Following Income Items from an S Corporation

question 87

Multiple Choice

Which of the following income items from an S corporation is not considered investment income for purposes of the Net Investment Income tax?

• A) Passive income.
• B) Interest income.
• C) Dividends.
• D) Short-term capital gains.
• E) All of these are considered investment income for the Net Investment Income tax.

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Definitions:

Taxable Portion

This is the part of any income or financial gain that is subject to taxation according to current tax laws.

Traditional IRA

An individual retirement account allowing individuals to direct pre-tax income towards investments that can grow tax-deferred until retirement withdrawals.

Minimum Distribution

The required minimum amount that must be withdrawn annually from retirement accounts after reaching a certain age.

Plan Balance

The total current value of an individual's account in a retirement plan, reflecting contributions, investment gains or losses, and withdrawals made over time.