Mei's coffee shop made $250,000 profit last year. Mei and her partner will report their share of profits on their individual tax return. What is the term for this type of taxation?

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Pass-through taxation is the term used when profits (or losses) of a business entity are reported on the individual tax returns of the business owners. In this case, Mei and her partner will report their share of the $250,000 profit on their individual tax returns, rather than filing a separate corporate tax return. Double taxation refers to the concept of a corporation paying tax on its profits and then the shareholders paying tax on the dividends they receive. Corporate taxation refers to the taxation of profits at the corporate level. Flat taxation is a tax system where everyone pays the same amount, regardless of their income level.

Mei's Coffee Shop Made $250,000 Profit Last Year