Which of the Following Statements Regarding the Translation of Foreign

question 28

Multiple Choice

Which of the following statements regarding the translation of foreign income taxes is true?

• A) Translation of foreign taxes into U.S. dollars helps manage the U.S. balance of trade.
• B) Foreign taxes are translated into U.S. dollars only when such translation provides a tax benefit to the taxpayer.
• C) Foreign taxes typically are paid in a foreign currency and, thus, must be converted to U.S. dollars when used as a FTC on a U.S. return.
• D) Translation of foreign taxes into U.S. dollars encourages foreign corporations to set up operations in the United States.

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Definitions:

Alexander Hamilton

A Founding Father of the United States, known for being an influential interpreter and promoter of the U.S. Constitution, as well as the founder of the nation's financial system.

Articles of Confederation

The first constitution of the United States, ratified in 1781, which established a national government with limited powers and significant authority granted to the states.

Unitary Government

A form of government where a single central authority holds the power, with no subdivisions like states having any significant autonomy.

Federal Government

The national level of government, having supreme authority over political units like states or provinces, responsible for the execution of national laws and policies.