S-type corporations have difficulty in accumulating earnings because their profits are subject to double taxation.

Name: S-type corporations have difficulty in accumulating earnings because their profits are subject to double taxation.
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Question

Quizplus · Accepted Answer

S-type corporations, or S corporations, pass their profits directly to their shareholders who then report the income on their personal tax returns, avoiding the double taxation that C corporations face.

S-Type Corporations Have Difficulty in Accumulating Earnings Because Their Profits