Jazz Corporation owns 50 percent of the Williams Corp. stock. Williams distributed a $10,000 dividend to Jazz Corporation. Jazz Corp.'s taxable income before the dividend was $100,000. What is the amount of Jazz's dividends received deduction on the dividend it received from Williams Corp.?

Question

Quizplus · Accepted Answer

Jazz Corporation can claim a 65% dividends received deduction on dividends from a 20%-or-more owned corporation. Therefore, 65% of the $10,000 dividend is $6,500.

Jazz Corporation Owns 50 Percent of the Williams Corp