Question

Which of the following statements is true? a. The statute of limitations always closes after six years. b. All states impose a state income tax. c. The only objective of the federal income tax law is to raise revenue. d. If a progressive tax rate system is used as a taxpayer's taxable income increases, a progressively lower tax rate is applied. e. None

Answer 1

a. The statute of limitations always closes after six years- FALSE

REASON : Each state has enacted its own Statute of limitations.Duration changes in every state

. b. All states impose a state income tax.-FALSE

Reason : 7 states doesnot impose State income tax - Alaska, Florioda,Neveda, WYOMING,South Dakota, Washington & Texas

c. The only objective of the federal income tax law is to raise revenue. - FALSE

REASON: It is one of the objectives ,Other objectives are economic development,empolyment,price stability etc

d. If a progressive tax rate system is used as a taxpayer's taxable income increases, a progressively lower tax rate is applied. -FALSE

REASON : In Progressive tax rate system , Lower income tax payer lower taxes and higher income tax payers pays high accordingly