Which of the following is true of S corporation shareholders?
A) They are taxed at individual rates.
B) They are taxed at corporate rates.
C) They do not enjoy legal protection that comes with corporate status.
D) They have no restrictions on benefit plans.

Question

Quizplus · Accepted Answer

S corporation shareholders are taxed at individual rates, not corporate rates. This is one of the advantages of the S corporation structure, as individual tax rates are typically lower than corporate tax rates. Additionally, S corporations provide legal protection for their shareholders, as they have limited liability protection similar to that of a traditional corporation. There may be some restrictions on benefit plans, but this varies based on the specific rules and regulations of the plan.

Which of the Following Is True of S Corporation Shareholders