when a corporation pays taxes on its net profit and pays dividends to
its shareholders (the company owners). The shareholders then have to report the
dividends as income on their tax returns and pay personal income taxes on the
dividend income. This double taxation does not occur when a corporation chooses
not to distribute any profits to its shareholders.
Series 24: Double Taxation
Taken from our Series 24 - FINRA General Principal Qualification Examination
Definition of the term Double Taxation...
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