Illegal bribes and kickbacks are not deductible as business expenses but fines imposed by a governmental unit are deductible as long as the fines are incurred in the ordinary course of business.

(A) True

(B) False

Question

Social Studies

Alfredo

5 July, 08:01

Illegal bribes and kickbacks are not deductible as business expenses but fines imposed by a governmental unit are deductible as long as the fines are incurred in the ordinary course of business.

(A) True

(B) False

+3

Answers (1)

Know the Answer?

Woody · Answer 1

A) True

Explanation:

Business expenses are legitmate expenses made by an entreprenuer in the cause of his or her running of his business. Illegal and kickbacks are not legitmate expenses as a result of the nature in which it is carried out. Imagine a situation where someone is supposed to pay his personal income tax that amount to $5000 but decided to pay bribe worth $2000. There is clearly cheating and most government frowns heavily on it.

On the other hand, fines imposed by a governmental unit on a business could be deductible as a result of it being a legitimate transction that is backed up by law.

Illegal bribes and kickbacks are not deductible as business expenses but fines imposed by a governmental unit are deductible as long as the fines are incurred in the ordinary course of business.(A) True(B) False

Illegal bribes and kickbacks are not deductible as business expenses but fines imposed by a governmental unit are deductible as long as the fines are incurred in the ordinary course of business.

(A) True

(B) False