Tax Planning (LO 12.7) Select either "True" or "False" for each of the following statements. Item Description Answer a. Decreasing one's tax liability through legal methods is called tax - planning, while illegally reducing taxes is called tax evasion. b. In a "closed" transaction, all tax - significant events have been completed. c. The marginal tax rate is computed as the total tax paid divided by the total income of the taxpayer. d. The marginal tax rate is the most important rate for decision making in tax - planning situations. e. A timing tax - planning technique usually has the objective of deferring the payment of tax until a later year.
Tax Planning (LO 12.7) Select either "True" or "False" for each of the following statements. Item Description Answer a. Decreasing one's tax liability through legal methods is called tax - planning, while illegally reducing taxes is called tax evasion. b. In a "closed" transaction, all tax - significant events have been completed. c. The marginal tax rate is computed as the total tax paid divided by the total income of the taxpayer. d. The marginal tax rate is the most important rate for decision making in tax - planning situations. e. A timing tax - planning technique usually has the objective of deferring the payment of tax until a later year.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Tax Planning (LO 12.7) Select either "True" or "False" for each of the following statements. Item
Description Answer a. Decreasing one's tax liability through legal methods is called tax -
planning, while illegally reducing taxes is called tax evasion. b. In a "closed" transaction, all tax
- significant events have been completed. c. The marginal tax rate is computed as the total
tax paid divided by the total income of the taxpayer. d. The marginal tax rate is the most
important rate for decision making in tax - planning situations. e. A timing tax - planning
technique usually has the objective of deferring the payment of tax until a later year.
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