Glover, Inc. had $350,000 of taxable income, all of which was personal holding company income. The corporation paid a dividend of $350,000 in November. The corporation will owe a personal holding company tax for the year.

Question

Quizplus · Accepted Answer

Since Glover, Inc. distributed all of its personal holding company income as dividends, it will not owe personal holding company tax for the year. Personal holding company tax generally applies to undistributed personal holding company income.