Teal, Inc, Is a Private Foundation Which Failed to Distribute an an Adequate

question 30

Multiple Choice

Teal, Inc., is a private foundation which failed to distribute an adequate amount of income for the exempt purpose of Teal.Which of the following statements is correct?

• A)An excise tax in the form of an initial tax at the rate of 5% may be imposed on Teal.
• B)An excise tax in the form of an initial tax at the rate of 2.5% may be imposed on the foundation manager.
• C)An excise tax in the form of an additional tax at the rate of 100% may be imposed on Teal.
• D)An excise tax in the form of an additional tax at the rate of 50% may be imposed on the foundation manager.
• E)None of the statements is correct.

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Definitions:

Socialism

A political and economic theory advocating for collective or governmental ownership and administration of the means of production and distribution of goods.

Capitalist Society

A socio-economic system characterized by private or corporate ownership of capital goods, investments determined by private decision, and prices, production, and the distribution of goods determined mainly by competition in a free market.

Programs

Planned series of activities or procedures designed to achieve a specific goal or purpose, often related to education, health, or social services.

Industrial Revolution

A period of major industrialization from the late 18th to early 19th centuries that transformed mainly agrarian, rural societies in Europe and America into industrialized, urban ones.