Question

- What are the correct monthly rates for calculating failure to file and failure to pay penalties?

A)

Failure to file	Failure to pay
5.0%	5.0%

       

B)

Failure to file	Failure to pay
0.5%	0.5%

       

C)

Failure to file	Failure to pay
5.0%	0.5%

       

D)

Failure to file	Failure to pay
0.5%	5.0%

- The largest source of revenues for the federal government comes from

A) corporate income taxes.

B) individual income taxes.

C) Social Security and Medicare taxes (FICA).

D) estate and gift taxes.

- Which of the following is not a taxpaying entity?

A) partnership

B) C corporation

C) individual

D) All of the above are taxpayers.

- In an S corporation, shareholders

A) are taxed only on dividends.

B) may allocate income among themselves in order to consider special contributions.

C) are taxed on their proportionate share of earnings.

D) are only taxed on salaries.

- Which of the following is not an advantage of a limited liability company (LLC)?

A) default tax treatment as a corporation, unless otherwise elected

B) limited liability for all members of a LLC

C) ability to choose between taxation as a partnership or corporation

D) All of the above are advantages of an LLC.