What Is the Advantage of an Advance Pricing Agreement

question 12

Multiple Choice

What is the advantage of an advance pricing agreement?

• A) IRS (Internal Revenue Service) will not challenge the transfer price after the tax return is filed if the agreement is followed.
• B) Worldwide taxes will be minimized.
• C) The brief form explaining the transfer price to be used can be completed with minimal effort by the taxpayer but will reduce a tremendous amount of work later.
• D) All of the above are advantages of APA.

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Definitions:

Trustee

An individual or organization that holds or manages property, assets, or a trust on behalf of another.

Nonexempt Assets

Assets that a debtor must forfeit to creditors or to a bankruptcy trustee under bankruptcy proceedings, not protected by exemption laws.

Chapter 7

A chapter of the U.S. Bankruptcy Code that involves the liquidation of a debtor's assets to repay creditors.

Bankruptcy Rules

Regulations governing the process of bankruptcy, dictating how debts are discharged and assets are handled among creditors and debtors.