Which of the Following Is an Explanation for Why Insurance

question 72

Multiple Choice

Which of the following is an explanation for why insurance premiums on a key employee are not deductible?

• A) The insurance deduction would offset taxable income without the potential for the proceeds generating taxable income.
• B) The federal government does not want to subsidize insurance companies.
• C) It is impractical to trace insurance premiums to the receipt of proceeds.
• D) Congress presumes that all expenses are not deductible unless specifically allowed in the Internal Revenue Code.
• E) This rule was grandfathered from a time when the IRC disallowed all insurance premiums deductions.

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Definitions:

Managerial Implications

Refers to the practical outcomes or effects of management theories, strategies, or decisions on organizational operations.

Content Theories

Focus on identifying specific factors that motivate individuals at work, including needs, desires, and goals that propel behavior.

Maslow

Refers to Abraham Maslow's hierarchy of needs, a psychological theory that ranks human needs in a pyramid, with physiological needs at the base and self-actualization at the top.

Alderfer

Refers to Clayton Alderfer's ERG theory on human needs and motivation, classifying needs into Existence, Relatedness, and Growth categories.