What factors might lead to cross sectional and time series differences in corporate tax rates, personal tax rates, and shareholder level tax rates? How do these differences affect tax planners? How do these differences affect tax policymakers?
Answer to relevant QuestionsWhy might one group of investors prefer the corporate form, whereas another group of investors prefers the partnership form? Suppose Congress was to reduce the top capital gains tax rate, tcg, to 10% from 15%. How would this affect the required pretax corporate return, R*c, calculated in the final line of Table 4.4? That is, recalculate the ...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 ...Provide an example of organizational form arbitrage using corporations and partnerships. What is an example of organizational form arbitrage involving a long term investment in common stocks? What restrictions are in place ...a. A taxpayer is considering buying a fully taxable corporate bond. The bond has a remaining maturity of 5 years, promises to pay 6% interest annually (assume the coupon interest is payable annually), and has a face value of ...
Post your question