Which Statement Is Incorrect

question 10

Multiple Choice

Which statement is incorrect?

• A)S corporations are treated as corporations under state law.
• B)S corporations resemble partnerships under the Federal income tax law.
• C)The alternative minimum tax applies to some S corporations.
• D)An S corporation may not allocate income and deduction items to specific shareholders like a partnership can.

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Definitions:

Special Assessment

A charge that local governments impose on property owners to fund specific projects, such as infrastructure improvements, which directly benefit the property owners.

Derived Tax Revenues

Revenues obtained from taxes that are not directly levied on income or profits but are instead based on the use or consumption of goods and services.

Committed

Refers to being pledged or bound to a certain course or policy, especially in the context of project or resource planning.

Nonspendable

Funds that cannot be spent because they are either not in spendable form or are legally or contractually required to be maintained intact.