Which of the following statements regarding preferred share financing is false?

Question

Quizplus · Accepted Answer

Current tax laws do not simplify the nature of preferred share financing for corporations. Instead, preferred share financing can be complicated due to various tax implications, such as the special tax on preferred dividends in excess of $500,000 annually. The other statements are true - preferred share dividend payments are non-deductible, the preferred share issue may be structured to enhance after-tax return of investors, and there is a special tax on preferred dividends in excess of $500,000 annually.

Which of the Following Statements Regarding Preferred Share Financing Is