What is the default classification for federal tax purposes of a U.S. eligible entity with one...
What is the default classification for federal tax purposes of a U.S. eligible entity with one owner? A. Partnership B. Corporation C. Limited liability partnership D. Disregarded entity
Homework Answers
| What is the default classification for federal tax purposes of a U.S. eligible entity with one owner? | |
| Ans: | Option D i.e. Disregarded entity is correct. |
| Explanation:- |
As per IRS code, if entity does not elects for its classification, then default classifaction for federal tax purposes applies. Th eligible entities with more than one owner are treated as partnership and entities with single owner are treated as disregarded entity. |
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