Which of the following statements regarding the taxation of U.S. real property gains recognized by non-U.S. persons not engaged in a U.S. trade or business is false? Gains from the disposition of U.S. real property are:

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This statement is false. Non-U.S. persons are subject to taxation on gains from the disposition of U.S. real property, regardless of whether they are engaged in a U.S. trade or business. Such gains are subject to taxation in the U.S. because they are treated as if they are effectively connected to a U.S. trade or business. Additionally, non-U.S. persons are not exempt from taxation on capital gains from U.S. real property, as this is a specific exemption that does not exist under U.S. tax law.

Which of the Following Statements Regarding the Taxation of U