Harvesting a business by releasing the cash flows as dividends creates the worst tax disadvantage for _____.
A) C-corporation shareholders
B) partnerships
C) S-corporation shareholders
D) sole proprietors

Question

Quizplus · Accepted Answer

C-corporation shareholders face double taxation, where the corporation pays taxes on its income, and shareholders also pay taxes on the dividends they receive, leading to a significant tax disadvantage.

Harvesting a Business by Releasing the Cash Flows as Dividends