T, a C corporation, receives a dividend of $100 from a 15 percent owned U.S.corporation and has a dividend-received deduction of
A)$80
B)$70
C)$0
D)$100

Question

Quizplus · Accepted Answer

The dividend received deduction is equal to 50 percent of the dividend received for a 15 percent or greater ownership in the payor corporation. Thus, the dividend received deduction in this case would be $50 (50% x $100), resulting in taxable dividend income of $50 ($100 - $50). Therefore, choice B ($70) is the correct answer, as it represents the amount of taxable dividend income after subtracting the dividend received deduction.

T, a C Corporation, Receives a Dividend of $100 from a 15