The effective income tax rate on gain of $1 million resulting from the sale of qualified small business stock obtained in 2005 in an initial public offering and held more than five years is 14%. Do you agree or disagree? Explain. A. Agree. Half of the gain is excluded and the remaining half is taxed at a maximum rate of 28%, the effective tax rate is normally 14%. B. Agree. Seventy-five percent of the gain is excluded and the remaining twenty-five percent is taxed at a maximum rate of 25%, and the effective tax rate is normally 15%. A taxpayer would be taxed at 28% if the stock was held for less than five years. C. Disagree. Twenty-five percent of the gain is excluded from income and the remaining seventy-five percent is taxed at a maximum rate of 28%. The effective tax rate would be 14%. D. Disagree. The gain resulting from the sale or exchange of small business stock and only held for five years is taxed at the maximum rate of 25%. The effective tax rate is 15% and the gain is not eligible for the exclusion