Home
/
Business
/
10. TRUE/FALSE Dividends are paid by companies based on their profits and reserves. Although they are subject to income tax, a taxpayer can minimize the tax paid on dividends if the taxpayer's income is less than the Standard Deduction. True False

Question

10. TRUE/FALSE
Dividends are paid by companies based on their profits and reserves. Although they are subject to income tax, a taxpayer can minimize the tax paid on dividends if the taxpayer's
income is less than the Standard Deduction.
True
False

10. TRUE/FALSE Dividends are paid by companies based on their profits and reserves. Although they are subject to income tax, a taxpayer can minimize the tax paid on dividends if the taxpayer's income is less than the Standard Deduction. True False

expert verifiedVerification of experts

Answer

4.2226 Voting
avatar
PeterExpert · Tutor for 3 years

Answer

### True

Explain

## Step1: Understanding Dividends and Taxation<br />### Dividends are payments made by a corporation to its shareholders, usually derived from profits and reserves. These payments are generally subject to income tax.<br />## Step2: Standard Deduction and Tax Minimization<br />### The standard deduction is a portion of income that is not subject to tax, which reduces the taxable income. If a taxpayer's total income, including dividends, is less than the standard deduction, the taxpayer may not owe any income tax on those dividends.<br />## Step3: Evaluating the Statement<br />### Given the information, if a taxpayer's income, including dividends, is less than the standard deduction, they can indeed minimize or eliminate the tax paid on dividends.
Click to rate:

Hot Questions

More x