True/False 1.Business tax credits are limited to tax-paying entities and individ

Question

True/False

1.Business tax credits are limited to tax-paying entities and individuals.

2.The differences between MACRS depreciation and depreciation allowed for computing AMT results in a permanent difference between taxable income and AMTI.

3.A tax credit produces a tax benefit only to the extent of the effective tax rate in the taxpayer's top bracket multiplied by the amount of the credit.

4.A married taxpayer is required to file a joint return in all circumstances in order to be eligible for the earned income credit.

5.Child care expenses incurred by a taxpayer who is attending a full-time course of studies at an educational institution may be included in the credit computation.

6.All taxpayers must compute their income tax liability under both the regular income tax system and the alternative minimum tax system and pay the higher of the two accounts.

7.The employer's wage deduction is reduced by the amount of work opportunity credit claimed.

8.The work opportunity credit is allowed for up to $2,400.

9.Qualifying property for the general business credit includes buildings and their structural components.

10.Unused general business credits can be carried back two years and forward for up to 15 years.

11.Most tax credits exist to encourage businesses to make certain types of decisions.

12.The credit for outside dependent care applies only to dependents under 13 years of age.

13.For purposes of determining whether a corporation is subject to AMT, once a corporation fails to qualify as a small corporation, it cannot qualify in any subsequent tax year.

Explanation / Answer

1-true

2-false

3-true

4-true

5-false

6-true

7-false

8-true

9-true

10-false

11-true

12-true

13-false

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