Tax-deductible fringe benefits

Assignment Help Financial Management

Reference no: EM131920780

1. Use of a cross-purchase agreement (instead of a stock redemption agreement) avoids which of the following problems?

a. The need for multiple life insurance policies.

b. Imposition of the corporate AMT on insurance proceeds.

c. The danger that the IRS will value the decedent's shares at an unreasonably high amount.

d. The step-up in basis in the surviving spouse's shares in community property states.

2. All of the following are tax-deductible fringe benefits a C corporation may provide to its shareholder-employees except?

a. Pension and profit-sharing plans.

b. Group life insurance.

c. Group health insurance.

d. One-time taxation of income.

3. In the case of a gift-leaseback, which of the following is not true?

a. The trust must have an independent trustee unrelated to the grantor.

b. The leaseback must be in writing.

c. The gift in trust must have a bona fide business purpose.

d. The donor cannot retain the same control over the property as he did before the gift was made.

Reference no: EM131920780

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