"Bracket creep" is avoided by:
A)Using sunset provisions.
B)Providing special tax rules for small businesses.
C)The statute of limitations.
D)Adjusting the rate brackets for inflation annually.

Question

Quizplus · Accepted Answer

Adjusting the rate brackets for inflation annually avoids bracket creep. Bracket creep occurs when inflation causes taxpayers' income to increase, pushing them into higher tax brackets and resulting in higher taxes without any increase in real income. By adjusting the brackets for inflation, taxpayers are only taxed based on their actual increase in real income, rather than the amount of inflation.

"Bracket Creep" Is Avoided By