Income, Not Dividends, Double-Taxed

BY RICHARD P. CREAGH

I read with interest “ An Opinion on Dividends’ Taxation ” and the claim that dividends are not double-taxed. While I agree the dividends are not double-taxed, the income, however, is.

The corporation pays tax on its earnings and then the stockholder pays tax when dividends are paid by the corporation (out of aftertax profits) and included as income in the stockholder’s tax return.

One other point: The corporation’s board of directors, not management, declares dividend amounts.

Richard P. Creagh, CPA
Brea, California

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100th ANNIVERSARY

Black CPA Centennial, 1921–2021

With 2021 marking the 100th anniversary of the first Black licensed CPA in the United States, a yearlong campaign kicked off to recognize the nation’s Black CPAs and encourage greater progress in diversity, inclusion, and equity in the CPA profession.