John owns stock in Green Corporation, which, in turn, owns stock in IBM. When IBM earns income, it is subject to the corporate income tax (i.e., the first tax). When IBM pays a dividend, Green Corporation must pay a corporate income tax on its share (i.e., the second tax). When Green Corporation pays a dividend, John must pay an individual income tax on what he receives (i.e., the third tax). Thus, the same income is subject to triple taxation.
a.How does the tax law mitigate the tax on Green Corporation?
b.How does the tax law mitigate the tax imposed on John?

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The Answer of John owns stock in Green Corporation, which, in turn, owns stock in IBM. When IBM earns income, it is subject to the corporate income tax (i.e., the first tax). When IBM pays a dividend, Green Corporation must pay a corporate income tax on its share (i.e., the second tax). When Green Corporation pays a dividend, John must pay an individual income tax on what he receives (i.e., the third tax). Thus, the same income is subject to triple taxation.
a.How does the tax law mitigate the tax on Green Corporation?
b.How does the tax law mitigate the tax imposed on John?

John Owns Stock in Green Corporation, Which, in Turn, Owns