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Corporations are required to compute and pay the accumulated earnings tax by the due date of...

Corporations are required to compute and pay the accumulated earnings tax by the due date of the tax return. T/F

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Answer #1

Answer : False

Accumulated earnings tax is not a self-assessed tax. Upon review of a corporation, if IRS finds out that Retained Earnings of the corporation is beyond the reasonable needs of the business, accumulated earnings tax is imposed on that particular corporation . This makes it a penalty tax. Accumulated earnings tax is paid by corporation only when the IRS assesses the tax . Therefore, Accumulated earnings tax is not assessed or computed by the corporation Hence answer is 'False' '

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