Question

Question 3 of 75 Which of the following statement is correct regarding tax e s Cenevaty te amount of canceled debit must be used to reduce la strutes in a particular der The debtor may choose to the amount of canceled c ode the basis of depreca Except for cheat c overs .ce the laxatibutes by 31 for each tarot canceled debt that is All of these statements are true they relate to tas a bles t ering the taxe the homm e Martorp

Answer 1

Solution: All of these statements are true

Explanation: Except for the credit carryovers, decrease the attributes of tax listed earlier $1 dollar for each dollar of debt that is cancelled and excluded from income. There is decrease in the credit carryovers by 33^{1/3 cents for each dollar for debt that is cancelled which is excluded from income. The cancelled debt amount usually must be used for the reduction of tax attributes in a specific order}