Question

Which of the following statements is CORRECT regarding tax treaties:

a. They are authorized by the U.S. Constitution.
b. They are usually initiated by the State Department, not the Treasury.
c. The U.S. can have multiple types of tax treaties with one country.
d. All of the above statements are correct.

Answer 1

The correct statements regarding tax treaties are that they are authorized by the U.S. Constitution and the U.S. can have multiple types of tax treaties with one country.

Step-by-step explanation:

Regarding tax treaties:

• a. They are authorized by the U.S. Constitution. This is correct. The U.S. Constitution outlines the treaty process. The President negotiates treaties, the Senate consents by a two-thirds vote, and the President ratifies them.
• b. They are usually initiated by the State Department, not the Treasury. This statement is incorrect. Tax treaties are generally initiated by the Treasury Department because they deal with financial issues concerning taxes.
• c. The U.S. can have multiple types of tax treaties with one country. This is correct. It is possible for the U.S. to have different tax treaties addressing various topics with the same country.

Therefore, the correct statement regarding tax treaties is a and c.