Explain how a dividend tax imputation system works.
Answer to relevant QuestionsWhat is the effect of dividend imputation on r*c, the required after corporate tax— but before shareholder level tax rate of return? What is the effect of dividend imputation on r*c as k (the percentage of dividends that ...What are the major variables that affect the magnitude of the pretax corporate rate of return, Rc? Give examples to illustrate the importance of each variable. Is it possible to rank the importance of each variable? A taxpayer capitalizes a wholly owned corporation with $ 100,000. The corporation invests in a project that earns an annual pretax rate of return of 15% and faces a 15% corporate tax rate. The taxpayer faces a personal tax ...Let us assume, as was true of wealthy individuals in the United States in the 1960s, that the personal tax rate is 70% and that realized capital gains are taxed at half the top personal tax rate— that is, tcg = 35%. Assume ...List five assets that bear positive implicit taxes. Carefully explain why each asset bears an implicit tax (that is, how is the asset tax favored?).
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