Which of the following statements regarding C corporations is false? (1) C corpo

Question

Which of the following statements regarding C corporations is false? (1) C corporations are generally not subject to corporate income tax. (2) C corporations are separate entities for tax purposes. (3) shareholders of a C corporation have limited liability. (4) shareholders of a C corporation are taxed only when the corporation distributes earnings and profits. Which of the following statements regarding C corporations is false? (1) C corporations are generally not subject to corporate income tax. (2) C corporations are separate entities for tax purposes. (3) shareholders of a C corporation have limited liability. (4) shareholders of a C corporation are taxed only when the corporation distributes earnings and profits. Which of the following statements regarding C corporations is false? (1) C corporations are generally not subject to corporate income tax. (2) C corporations are separate entities for tax purposes. (3) shareholders of a C corporation have limited liability. (4) shareholders of a C corporation are taxed only when the corporation distributes earnings and profits. (1) C corporations are generally not subject to corporate income tax. (2) C corporations are separate entities for tax purposes. (3) shareholders of a C corporation have limited liability. (4) shareholders of a C corporation are taxed only when the corporation distributes earnings and profits.

Explanation / Answer

Ans (1) C corporations are generally not subject to corporate income tax

Correct Point: C corporations are generally subject to corporate income tax

All other points are correct as C Corporations are separate entities for tax purposes, have limited liability,  are taxed only when the corporation distributes earnings and profits..

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