CA Tax Law Specialist Practice Questions - California Certified Legal Specialist - Taxation Law Exam

Under IRC §162(a), a business expense is deductible only if it is:

Ordinary and necessary, paid or incurred in carrying on a trade or business Reasonable, regardless of whether it relates to a trade or business Capital in nature and properly depreciable Reimbursed by an employer or third party

Correct Answer:

Ordinary and necessary, paid or incurred in carrying on a trade or business

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