Which of the following stock dividends would be tax-free to the shareholder?
A) A 2-for-1 stock split to all holders of common stock
B) A stock dividend where the shareholder could choose between cash and stock
C) A stock dividend to all holders of preferred stock
D) Both a 2-for-1 stock split to all holders of common stock and a stock dividend to all holders of preferred stock are tax-free to the shareholder
Correct Answer:
Verified
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