Which describes the tax consequences of ordinary dividends. A. Ordinary dividend distributions are not taxed to a distributing​ corporation, therefore shareholders will report dividend income on the amount received. B. Ordinary dividend distributions require the distributing corporation to recognize gain when distributing noncash property as a dividend. Shareholders report dividend income equal to the FMV of the property distributed when the distribution comes from earnings and profits. C. Ordinary dividend distributions require the distributing corporation to report gain or loss when property is​ distributed, therefore shareholders will not have to recognize gain or loss. D. None of the above.

Respuesta :

Answer:

(B) Ordinary dividend distributions require the distributing corporation to recognize gain when distributing the noncash property as a dividend. Shareholders report dividend income equal to the FMV of the property distributed when the distribution comes from earnings and profits.

Explanation :

A qualified dividend is a profit that falls under capital increases expense rates that are lower than the annual duty rates on unfit, or joint, profits. Profit expense rates for common dividends. Regular profits are delegated either qualified or normal, each with various duty suggestions that effect a speculator's net return. The expense rate on qualified profits for speculators that have customary salary exhausted at 10% or 12% is 0%.

Ordinary dividends are taxed a person's typical annual duty rate, rather than the favored rate for qualified profits as recorded previously.