Answer:
Double taxation is a process that affects stockholders of C corporations because business profits are taxed at both the corporate and personal levels.
Explanation:
Double taxation is a process that affects stockholders of C corporations because business profits are taxed at both the corporate and personal levels.
The corporation pays income tax at the corporate rate before arriving at Net profit after tax from which dividends can be paid to shareholders.
The profits distributed to shareholders through dividends are again subject to income tax at the shareholders personal level at the personal income tax rate.
By so doing, the original corporate profits have been subjected to income taxes twice.
