Which of the Following Best Describes How Corporations Are Taxed

question 138

Multiple Choice

Which of the following best describes how corporations are taxed on dividend income?

• A)Like individuals, corporations are taxed on all dividends received.
• B)Fifty percent of dividend income received by corporations is tax exempt.
• C)Varying amounts of dividend income received by corporations are tax exempt, depending on the percent of the paying corporation that the receiving corporation owns.
• D)In order to avoid triple taxation of earnings, dividend income received by one corporation from another in which it owns twenty percent stock is 100% tax exempt.

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