Which Reason Is Unlikely to Cause a Regular Corporation to Have

question 87

Multiple Choice

Which reason is unlikely to cause a regular corporation to have to pay AMT?

• A)A service-type of company with little inventory.
• B)A high level of investment in assets such as equipment and structures.
• C)Low taxable income due to a cyclical downturn, strong international competition, a low-margin industry, or other factors.
• D)Investment at low real interest rates, which increases the company's deductions for depreciation relative to those for interest payments.
• E)None of the above.

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Definitions:

Limited Liability

A legal principle that protects shareholders from being personally responsible for more than their investment in a corporation.

LLC

A Limited Liability Company (LLC) is a business structure in the United States that protects its owners from personal responsibility for its debts or liabilities.

Dissolution

The process of legally dissolving a corporation or partnership, ending its existence.

Partnership

A business structure where two or more individuals manage and operate a business in accordance with the terms and objectives set out in a Partnership Agreement.