(South-Western Federal Taxation 2026 Corporations, Partnerships, Estates and Trusts, 47e Raabe, Nellen, Young, Cripe, Lassar, Persellin, Cuccia ) (Test Bank all Chapters)(555pages)

Chapter 01: Understanding and Working with the Federal Tax Law Indicate whether the statement is true or false. 1. Many states have balanced budgets because laws or constitutional amendments preclude deficit spending. a. True b. False 2. The U.S. Federal government has a provision in the Constitution that precludes deficit spending. a. True b. False 3. Revenue-neutral tax laws reduce deficits. a. True b. False 4. Longer class lives for depreciable property and the required use of the straight-line method of depreciation would likely dampen the tax incentive for purchasing capital assets. a. True b. False 5. The Internal Revenue Code is a compilation of Federal tax legislation that appears in Title 26 of the United States Code. a. True b. False 6. The favorable treatment of research and development expenses is one means of controlling the economy. a. True b. False 7. The encouragement of private-sector pension plans can be justified under the encouragement of certain industries. a. True b. False 8. One Internal Revenue Code section enables shareholders in a small business corporation to obtain an ordinary deduction for any loss recognized on a stock investment. a. True b. False 9. One of the justifications for the enactment of the tax law governing corporate reorganizations was the economic benefit it would provide businesses (including making them more efficient). a. True b. False 10. Although a corporation is subject to a Federal income tax, a partnership is not. a. True b. False