Double taxation
In accounting, double taxation means a C corporation's profit taxed to the corporation when earned and again to its shareholders when paid out as dividends. The corporation gets no deduction for the dividend, and shareholders cannot deduct its losses.
Authority: IRS — Forming a corporation (opens in a new tab). Sources
The lessons that teach this
From the free founder back-office course, taught on one company's books, with exercises to work it yourself.
- EntitiesThe entity menu › C corporationA corporation that pays its own 21% tax, with owners taxed again on dividends. Northwind is one.4 min
- EntitiesHow each entity is taxedSchedule C, Form 1065, Form 1120-S and Form 1120 — and Northwind's illustrative year taxed twice as a C corporation (32.85%) or once as a partnership.10 min
What it is not called
Each of these means something else. Use one here and an accountant reading the product notices.
- double tax treaty (two countries taxing the same income)
Components that render the terms it depends on
No component names this concept outright, but it's built from terms that components do name. These render dividend.
Also in Entity types
Defined in Lexicon. This page is generated from that document, so the two can't disagree.