What is a Double Taxation?

 What is a Double Taxation?

 

Double taxation relates to C corporations when profits made within a given business are taxed on two various levels. One of these levels include the corporation paying income tax at the corporate rate before profits are released to the shareholders. Secondly, when the profits are distributed to shareholders, they are also subject to income tax on an individual proportion. Therefore, corporate profits within a corporation are subject to double income taxation.

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