Although Congressional intent in creating the Controlled Foreign Corporation (CFC) legislation was to penalize inactive corporations located in tax-haven countries, active corporations that are not organized primarily to avoid U.S.taxation are subject to the CFC provisions.

Question

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The statement is true. The CFC legislation was intended to penalize inactive corporations in tax-haven countries, but it also applies to active corporations that are not organized primarily to avoid U.S. taxation.

Although Congressional Intent in Creating the Controlled Foreign Corporation (CFC)