CHAPTER 24 Multistate Corporate Taxation QUESTIONS AND ANSWERS-ALL CORRECT

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CHAPTER 24 Multistate Corporate Taxation 3021. Roughly forty percent of all taxes paid by businesses in the U.S. are to state, local, and municipal jurisdictions. *a. True b. False 3022. Usually... a business chooses a location where it will build a new plant based chiefly on tax considerations. a. True *b. False 3023. Politicians use tax devices to create economic development incentives. *a. True b. False 3024. All of the U.S. states have adopted a tax based on net taxable income. a. True *b. False 3025. Most of the U.S. states have adopted an alternative minimum tax, similar to the Federal system. a. True *b. False 3026. States collect the most tax dollars from the corporate income tax. a. True *b. False 3027. The corporate income tax provides about 5 percent of the annual tax revenues for the typical U.S. state. *a. True b. False3028. State and local politicians tend to apply new and increased taxes to taxpayers who are visitors to the jurisdiction and cannot vote to reelect the lawmaker. *a. True b. False 3029. A state or local tax on a corporation’s income might be called a franchise tax or a business privilege tax. *a. True b. False 3030. Most states begin the computation of taxable income with an amount from the Federal income tax return. *a. True b. False 3031. If a state follows Federal income tax rules, the state’s tax compliance and enforcement become easier to accomplish. *a. True b. False 3032. A typical state taxable income addition modification is the interest income from U.S. Treasury bonds. a. True *b. False 3033. COMPREHENSIVE VOLUME CHAPTER 24MULTISTATE CORPORATE TAXATION 13 A typical state taxable income addition modification is the Federal net operating loss (NOL) deduction. *a. True b. FalseCHAPTER 24 Multistate Corporate Taxation 3034. A state cannot levy a tax on a business unless the business was incorporated in the state. a. True *b. False 3035. Typical indicators of nexus include the presence of employees based in the state, and the ownership or lease of realty there. *a. True b. False 3036. Under P.L. 86-272, the taxpayer is exempt from state taxes on income resulting from the mere solicitation of orders for the sale of in-state realty [Show More]

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