Your company is taxed on profits, and then you are also taxed personally on your distributions from the company. You are heavily regulated by the government. This must be a .....

TYPES OF ENTREPRENEURSHIP

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Your company is taxed on profits, and then you are also taxed personally on your distributions from the company. You are heavily regulated by the government. This must be a ____

A	Sole Proprietorship
B	Partnership
C	Corporation
D	Franchise

Explanation:

Detailed explanation-1: -Double taxation occurs when income is taxed at both the corporate level and personal level, as in the case of stock dividends. Double taxation also refers to the same income being taxed by two different countries.

Detailed explanation-2: -Corporate Tax Calculation Evaluate the corporation’s taxable income using this formula: Taxable income = Adjusted Gross Income – All Applicable Deductions. Multiply the corporation tax percentage with the taxable income to determine the corporation tax liability: Corporate Tax=Taxable Income × Corporate Tax Rate.

Detailed explanation-3: -The profit of a corporation is taxed to the corporation when earned, and then is taxed to the shareholders when distributed as dividends. This creates a double tax. The corporation does not get a tax deduction when it distributes dividends to shareholders. Shareholders cannot deduct any loss of the corporation.

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INTRODUCTION TO ENTREPRENEURSHIP

TYPES OF ENTREPRENEURSHIP