Which of the following activities constitutes tax avoidance?

Question

Quizplus · Accepted Answer

Tax avoidance refers to legal ways to reduce one's tax liability, such as taking advantage of deductions and credits. Increasing charitable contributions in December is a legitimate way to lower one's taxes. Selling illegal drugs, not reporting tips, and selling alcohol and cigarettes are all illegal activities and therefore do not fall under tax avoidance. Selling a condominium may or may not be tax avoidance, as it depends on several factors such as the purchase price and any capital gains taxes owed upon sale.

Which of the Following Activities Constitutes Tax Avoidance