During the current year,Swallowtail Corporation receives dividend income of $40,000 from a 15%-owned domestic corporation.What is Swallowtail's maximum allowable dividend-received deduction for the current year?
A)$- 0 -
B)$28,000
C)$32,000
D)$36,000
E)$40,000

Question

Quizplus · Accepted Answer

The maximum allowable dividend-received deduction for a 15%-owned domestic corporation is 70% of the dividend income. Therefore, Swallowtail's maximum allowable dividend-received deduction is $40,000 x 70% = $28,000.

During the Current Year,Swallowtail Corporation Receives Dividend Income of $40,000