If a corporation elects to be taxed as an S corporation,then it can avoid the corporate tax.However,its stockholders will have to pay personal taxes on the firm's net income.

Question

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When a corporation elects to be taxed as an S corporation, its income is passed through to the individual stockholders who report it on their personal tax returns. The corporation itself is not taxed at the corporate level, allowing for potential tax savings. However, the individual stockholders will have to pay personal taxes on their share of the corporation's net income.

If a Corporation Elects to Be Taxed as an S