Which of the following types of income would probably be considered "business income" for state income tax purposes?
A)Rents received on a piece of residential property not used in the taxpayer's trade or business
B)Royalties from the licensing of a patent developed by the taxpayer in the ordinary course of its research and development activities
C)Gain recognized on the sale of an asset not used in the regular course of the taxpayer's trade or business
D)Dividends on long-term investments of excess funds
E)None of the above

Question

Quizplus · Accepted Answer

Business income is generally considered the income earned from a taxpayer's trade or business operations. Royalties from the licensing of a patent developed in the ordinary course of a taxpayer's research and development activities would be considered business income. The other options do not involve income earned from a taxpayer's trade or business activities and would not be considered business income.

Which of the Following Types of Income Would Probably Be