Explain Why Double Taxation Is Considered a Disadvantage of a Corporate

question 165

Essay

Explain why double taxation is considered a disadvantage of a corporate form of organization. Explain how double taxation occurs.

---

Definitions:

Depositary Bank

A financial institution that holds and manages securities deposits and facilitates trading of these financial assets.

Drawee Bank

Drawee bank refers to the bank upon which a check or draft is drawn, responsible for paying the specified amount of money to the entity presenting the check for payment.

Payor Bank

A bank that is responsible for paying the check or draft drawn on the funds deposited in an account.

Unauthorized Signatures

Signatures made without the proper permission or authority, potentially voiding or bringing into question the validity of the document signed.