Omaha Inc. owns 100 percent of the stock in Franco, a foreign corporation. All Francos income is

Question:

Omaha Inc. owns 100 percent of the stock in Franco, a foreign corporation. All Franco’s income is foreign source, and its foreign income tax rate is 20 percent. This year, Franco distributed a $50,000 to Omaha.
a. Assuming that Omaha is in the 35 percent tax bracket, compute its U.S. tax on the How would your computation change if the foreign income tax rate was 45 percent? Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...