What Is the Process of Double Taxation for the Stockholders

question 76

Multiple Choice

What is the process of double taxation for the stockholders in a corporation?

• A)Their shares are taxed when they are both bought and sold.
• B)The corporation is taxed on the profits it makes,and the owners are taxed when this profit is distributed to them.
• C)The owners of a corporation are taxed when they receive dividend payments and when they make a profit from the sale of shares.
• D)The corporation must pay taxes on any profits it makes,and the capital raised by the sale of shares is also subject to taxation.
• E)The corporation is taxed on any profits it makes,and owners are taxed when they sell their shares.

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Definitions:

Household Members

Individuals who reside in the same home and often share living expenses; may include family members and roommates.

Implied Warranty of Assignability

An assurance within the scope of the law that a contract can be transferred or assigned to another party.

Common Law

A legal system based on judicial decisions and precedent rather than statutory laws.

Warranties of Title

Legal guarantees provided by a seller that they have the right to sell the property and that there are no encumbrances against it.