If the corporate tax rate is 35%,what is the maximum effective tax rate on dividends received by another corporation?

Question

Quizplus · Accepted Answer

The maximum effective tax rate on dividends received by another corporation is 80% of the corporate tax rate, which is 28%. However, the dividends received deduction allows for a reduction of 70% of the dividends received, resulting in an effective tax rate of 10.5% (28% x 30%). Therefore, the correct answer is C) 10.5%.

If the Corporate Tax Rate Is 35%,what Is the Maximum