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 these. All of these statements are effective strategies to mitigate or avoid double taxation.

Question

Quizplus · Accepted Answer

Paying dividends to shareholders does not mitigate double taxation; it actually triggers it, as dividends are taxed at both the corporate and shareholder levels.

Which of the Following Is Not an Effective Strategy for Mitigating