The practice generally known as double taxation is due to
A) shareholders' dividends being taxed at both the federal and state levels.
B) corporate income being taxed at both the federal and state levels.
C) interest on shareholders' dividends being taxed as income.
D) corporate incomes being taxed at the corporate level, then again at the shareholder level when corporate profits are paid out as dividends.

Question

Quizplus · Accepted Answer

Double taxation refers to the phenomenon where corporate incomes are taxed first at the corporate level, and then again at the individual shareholder level when these profits are distributed as dividends. This is a common critique of the corporate tax system in many countries, including the United States.

The Practice Generally Known as Double Taxation Is Due to