Money Snatchers

2 Responses

1. #1 Solutions
   Yes, the main beneif if you are a corporation and invest in another corporation is any dividends you revieve are 30% taxable.

2. #2 Turley M
   Not really. Corporations are their own entities and taxed as such. When income is distributed to the owner of the corporation, that income is taxed again. For example, a Biotech firm might invest in patents and research and development,and then selll those rights to drug manufacturers. The proceeds from the sale, minus their costs are taxed. Then the profits left over are then distributed to the owners of the corp, and those indivuals must pay tax on the profit distributions. Thus, they have been double taxed. Instead, if an individual invested in those patents and then resold them later at a profit, he would be just taxed once, since for individuals, the business tax reporting is the same as their own personal income tax reporting, They are not separate from the business component as is the corporation. It’s its own entity. There may be instances where its more favoravble, given the convoluted tax law, but in general, there is double taxation with corps, but at the same time, the liabilty is confined to the corp. thus the owners only risk their investment.

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