Identify Which of the Following Statements Is False

question 54

Multiple Choice

Identify which of the following statements is false.

• A)An individual taxpayer, who is assessed an additional payment of money based on stock ownership in a corporation whose stock is redeemed in a complete liquidation, may recognize a capital loss to the extent of the additional assessment.
• B)The open transaction doctrine defers the shareholder's gain or loss from a liquidation until the assets can be valued by sale or collection.
• C)The open transaction doctrine as applied to complete corporate liquidations refers to the numerous planning alternatives available when liquidating a corporation.
• D)The IRS asserts that the open transaction doctrine should be used only in extraordinary circumstances.

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Definitions:

Last Clear Chance

A legal doctrine that states that a party who has the last opportunity to avoid an accident, despite the negligence of the opposing party, may be liable for any resulting damages.

Jury's Verdict

The formal decision or finding made by a jury, conveyed to the court, regarding the guilt or innocence of a defendant in a criminal case or the resolution of a civil dispute.

Negligence Claim

A legal assertion that an individual or entity failed to exercise a reasonable standard of care, resulting in harm or injury to another.

Oral Surgeon

A specialized dentist who performs surgical procedures on the mouth, teeth, jaws, and facial structures.