Test Bank for Pearson's Federal Taxation 2024 Corporations, Partnerships, Estates, & Trusts, 37th edition by Richardson
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Grado
Taxation
Institución
Taxation
Test Bank for Pearson's Federal Taxation 2024 Corporations, Partnerships, Estates, & Trusts, 37th edition 37e by Luke E. Richardson, Mitchell Franklin.
Full Chapters test bank are included - Chap 1 to 15 (Complete Chapters)
Tax Research
Corporate Formations and Capital Structure
The Corpora...
Test Bank Pearson's Fed. Taxation 2024: Corp., 37e
(Richardson et al.) Chapter C1: Tax Research
LO1: Overview of Tax Research
1) Tax planning is not an integral part of open-fact situations.
Answer: FALSE
Explanation: It is integral.
Page Ref.: C:1-2
Objective: 1
2) When a taxpayer contacts a tax advisor requesting advice as to the most advantageous way to dispose
of a stock, the tax advisor is faced with
A) a restricted-fact situation.
B) a closed-fact situation.
C) an open-fact situation.
D) a recognized-fact situation.
Answer: C
Explanation: Advice before transaction is open fact situation.
Page Ref.: C:1-2
Objective: 1
3) Investigation of a tax problem that involves a closed-fact situation means that
A) the client's transactions have already occurred and the tax questions must now be resolved.
B) the client's tax return has yet to be filed.
C) future events may be planned and controlled.
D) research is primarily concerned with applying the law to the facts as they exist.
Answer: A
Explanation: After the fact request is a closed fact situation.
Page Ref.: C:1-2
Objective: 1
4) Explain the difference between a closed-fact and open-fact situation.
Answer: In a closed-fact situation, the transaction has occurred and the facts are not subject to change.
In an open-fact situation, the transaction is in the formative or projected stage, and the taxpayer is able to
structure the facts so that the tax consequences of the transaction can be more favorable.
Page Ref.: C:1-2
Objective: 1
1
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