Which of the following is not an effective strategy for mitigating double taxation in a C corporation?
A) C corporations can shift income to shareholders via deductible payments.
B) C corporations can make an S election.
C) C corporations can pay dividends to their shareholders.
D) None of the choices are correct. All of the choices are effective strategies to mitigate or avoid double taxation.

Question

Quizplus · Accepted Answer

Dividends paid to shareholders are subject to double taxation, as they are taxed at the corporate level and again at the individual level when received by shareholders.

Which of the Following Is Not an Effective Strategy for Mitigating