Which of the following is not an effective strategy for mitigating the double tax associated with C corporations?
A) Borrowing money from a shareholder.
B) Paying a salary to a shareholder-employee.
C) Paying fringe benefits to a shareholder-employee.
D) Leasing property from a shareholder.
E) All of the choices are effective strategies for mitigating double taxation.

Question

Quizplus · Accepted Answer

All of the choices are effective strategies for mitigating double taxation. Each of the options listed can help reduce the amount of corporate profits subjected to double taxation. Borrowing money from a shareholder, paying a salary to a shareholder-employee, paying fringe benefits to a shareholder-employee, and leasing property from a shareholder all allow for business expenses that reduce the amount of taxable income.

Which of the Following Is Not an Effective Strategy for Mitigating