Overview of Corporate Taxation

The video tutorial explains how individuals associated with corporations are taxed. Officers and directors receive salaries subject to income tax, while shareholders receive dividends taxed at a dividend rate. Corporations themselves are taxed as entities, with profits distributed to shareholders after taxes. Dividends are not subject to self-employment taxes. The video also covers the taxation of equity compensation, highlighting various methods to defer or offset taxes.

What type of tax rate is applied to a C Corporation's profits?

• Flat tax rate

• Tiered tax rate

• Progressive tax rate

• Regressive tax rate

How are dividends received by shareholders taxed?

• At the corporate tax rate

• At the dividend tax rate

• At the capital gains tax rate

• At the self-employment tax rate

Which of the following is NOT subject to self-employment taxes?

• LLC member income

• Sole proprietorship income

• Partnership income

• Shareholder dividends

What happens to the tax on equity compensation for officers and directors?

• It is taxed at a flat rate

• It can often be deferred to a future date

• It is always tax-free

• It is taxed immediately at the highest rate

How is the salary received by officers and directors taxed?

• At the corporate tax rate

• At the capital gains tax rate

• At the individual's income tax rate

• At the dividend tax rate