To prevent triple taxation, a corporation is entitled to deduct 50 percent of the dividends received from all other domestic corporations.

Question

Quizplus · Accepted Answer

The Dividends Received Deduction (DRD) allows corporations to deduct a portion of the dividends received from other domestic corporations, but the percentage is not fixed at 50%. The actual deduction percentage can vary, often being 50%, 65%, or 100%, depending on the ownership stake in the distributing corporation.

To Prevent Triple Taxation, a Corporation Is Entitled to Deduct