Question 1

Match the definition with the correct term.
-Bilateral agreement between two countries related to tax issues.

Accepted Answer

A)  Inbound
B)  Outbound
C)  Allocation and apportionment
D)  Qualified business unit
E)  Tax havenF) Income tax treatyG) Section 482H) B) and D)
I) A) and C)

Question 2

Dark, Inc., a U.S. corporation, operates Dunkel, an unincorporated branch manufacturing operation in Germany. Dark reports $100,000 of taxable income from Dunkel on its U.S. tax return along with $400,000 of taxable income from its U.S. operations. Dark paid $30,000 in German income taxes related to the $100,000 of Dunkel income. Assuming a U.S. tax rate of 21%, what is Dark's U.S. tax liability after any allowable foreign tax credits?

Accepted Answer

A)   $21,000
B)   $75,000
C)   $84,000
D)   $105,000E) C) and D)
F) B) and D)

Question 3

A U.S. business conducts international communications activities between the United States. and Spain. The resulting income is sourced 100% to the United States, the residence of the taxpayer.

Accepted Answer

A) True 
 B)False

Question 4

A tax haven often is:

Accepted Answer

A)   A country with high internal income taxes.
B)   A country with no or low internal income taxes.
C)   A country without income tax treaties.
D)   A country that prohibits treaty shopping.E) B) and C)
F) C) and D)

Question 5

Which of the following statements regarding income sourcing is not correct?

Accepted Answer

A)   Concerning the foreign tax credit, most U.S. persons benefit from earning low-tax foreign-source income.
B)   Foreign persons generally benefit from avoiding U.S.-source income classification.
C)   U.S. persons are not concerned with source of income because all their income is subject to U.S. tax under a worldwide system.
D)   Foreign persons may be subject to tax on U.S.-source income without regard to their actual presence in the United States.E) A) and B)
F) A) and C)

Question 6

Hendricks Corporation, a domestic corporation, owns 40 percent of Shane Corporation and 55 percent of Ferrell Corporation, both foreign corporations. Ferrell owns the other 60 percent of Shane Corporation. Both Shane and Ferrell are CFCs.

Accepted Answer

A) True 
 B)False

Question 7

The residence of seller rule is used in determining the sourcing of all gross income and deductions of a U.S. multinational business.

Accepted Answer

A) True 
 B)False

Question 8

Nico lives in California. She was born in Peru but holds a green card. Nico is a nonresident alien NRA).

Accepted Answer

A) True 
 B)False

Exam 9: Taxation of International Transactions

A U.S. business conducts international communications activities between the United States. and Spain. The resulting income is sourced 100% to the United States, the residence of the taxpayer.

Correct Answer
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A tax haven often is:

Correct Answer
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Correct Answer
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Match the definition with the correct term. -Bilateral agreement between two countries related to tax issues.

Correct Answer
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Nico lives in California. She was born in Peru but holds a green card. Nico is a nonresident alien NRA).

Correct Answer
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Which of the following statements regarding income sourcing is not correct?

Correct Answer
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Hendricks Corporation, a domestic corporation, owns 40 percent of Shane Corporation and 55 percent of Ferrell Corporation, both foreign corporations. Ferrell owns the other 60 percent of Shane Corporation. Both Shane and Ferrell are CFCs.

Correct Answer
verified

The residence of seller rule is used in determining the sourcing of all gross income and deductions of a U.S. multinational business.

Correct Answer
verified

Exam 9: Taxation of International Transactions

A U.S. business conducts international communications activities between the United States. and Spain. The resulting income is sourced 100% to the United States, the residence of the taxpayer.

Correct AnswerverifiedShow Answer

A tax haven often is:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Match the definition with the correct term. -Bilateral agreement between two countries related to tax issues.

Correct AnswerverifiedShow Answer

Nico lives in California. She was born in Peru but holds a green card. Nico is a nonresident alien NRA).

Correct AnswerverifiedShow Answer

Which of the following statements regarding income sourcing is not correct?

Correct AnswerverifiedShow Answer

Hendricks Corporation, a domestic corporation, owns 40 percent of Shane Corporation and 55 percent of Ferrell Corporation, both foreign corporations. Ferrell owns the other 60 percent of Shane Corporation. Both Shane and Ferrell are CFCs.

Correct AnswerverifiedShow Answer

The residence of seller rule is used in determining the sourcing of all gross income and deductions of a U.S. multinational business.

Correct AnswerverifiedShow Answer

Correct Answer
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