Which of the Following Statements Regarding Foreign Persons Not Engaged

question 159

Multiple Choice

Which of the following statements regarding foreign persons not engaged in a U.S. trade or business is true?

• A) Foreign persons are not subject to U.S. tax if not engaged in a U.S. trade or business.
• B) Foreign persons with any U.S.-source income are taxed on net investment income (after expenses).
• C) Foreign persons are subject to potential withholding taxes on the gross amount of U.S.-source investment income.
• D) Foreign persons with only U.S.-source investment income are exempt from U.S. tax.
• E) None of the above statements are true.

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Definitions:

Feminizing Fish

Feminizing fish refers to the phenomenon where male fish develop female characteristics, often due to exposure to environmental pollutants that act as endocrine disruptors.

Intra-segment Revenue

Revenues generated from transactions within the same segment of a company, which are often eliminated in consolidation to avoid overstating total revenue.

Consolidation Process

The method of combining and presenting the financial statements of a parent company and its subsidiaries as one set of financials.

Sales Revenue

Income earned from selling goods or services before any expenses are deducted.