SIE practice questionmediumDPPs — Types of Programs
Which of the following is a common type of Direct Participation Program?
- AExchange-traded funds
- BU.S. Treasury bonds
- COil and gas exploration partnerships✓ Correct answer
- DEquity mutual funds
Explanation
Why C — Oil and gas exploration partnerships
Common DPP types include oil and gas programs (exploration, development, income), real estate partnerships, equipment leasing, and agricultural programs. DPPs are NOT mutual funds (A), Treasury bonds (C), or ETFs (D). Oil and gas programs are particularly notable because certain costs (intangible drilling costs) provide significant tax deductions.
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