Techniques that can be used to minimize the current period tax liability include:
A)Recognizing the interaction between the regular income tax liability and the alternative minimum tax liability.
B)Utilization of special allocations.
C)Favorable treatment of certain fringe benefits.
D)Minimizing double taxation.
E)All of the above can be used for effective tax planning.

Question

Quizplus · Accepted Answer

All of the techniques listed can be used to minimize current period tax liability. Recognizing the interaction between the regular income tax liability and the alternative minimum tax liability can help avoid unexpected tax consequences. Utilizing special allocations can help allocate income and deductions in a way that minimizes overall tax liability. Certain fringe benefits, such as health savings accounts, can be treated favorably for tax purposes. Minimizing double taxation, such as through the use of tax treaties or foreign tax credits, can also reduce tax liability.

Techniques That Can Be Used to Minimize the Current Period