Final answer:
The Internal Revenue Code uses the term 'necessary' to describe deductible business expenses, which means the expense must be helpful and appropriate for the business.The correct option is 2.
Step-by-step explanation:
The Internal Revenue Code (IRC) specifies the types of expenses that are deductible by businesses in determining their taxable income. According to the IRC, in order for a business expense to be deductible, it must be both 'ordinary and necessary.' 'Necessary' in this context means that the expense is helpful and appropriate for the business, though it need not be indispensable.
The term necessary specifically refers to an expense that is appropriate and helpful in furthering the business endeavor. For instance, advertising costs, employee wages, and rent for office space are typically considered necessary expenses because they are typical and helpful costs for running a business.
Comparatively, the terms 'important', 'relevant', and 'crucial' are not standards used by the IRC to describe deductible business expenses. When dealing with tax matters, it is important to use the IRC's precise language to ensure proper understanding of the tax implications.
Thus, the correct answer to our question is: Option 2: Necessary.