Attempts 0 Keep the Highest 017 12. The tax system Provisions of the U.S. Tax Code for Corporations and Individuals In general, is the U.S. federal tax system progressive or regressive? Progressive Regressive The applicable tax rate for S corporations is based on the Stockholders' individual tax rates Corporate tax rate Green Catepillar Garden Supplies owns 316,000 shares in the Big Bovine Fertilizer Company. If Big Bovine has 400,000 shares of common stock outstanding, can Green Catepillar file a single income tax return that reports the incomes and expenses of both companies? Yes, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is greater than or equal to 80%, as required by the U.S. Tax Code No, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is less than or equal to 79%, whereas 80% or more is required by the U.S. Tax Code. No, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is less than or equal to 40%, whereas 50% or more is 5 TO FIT cial Management Stockholders' individual tax rates Corporate tax rate Green Catepillar Garden Supplies owns 316,000 shares in the Big Bovine Fertilizer Company. If Big Bovine has 400,000 shares of common stock outstanding, can Green Catepillar file a single income tax return that reports the incomes and expenses of both companies? Yes, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is greater than or equal to 80%, as required by the U.S. Tax Code No, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is less than or equal to 79%, whereas 80% or more is required by the U.S. Tax Code No, because Green Catepillar Garden Supplies's ownership stake in Big Bovine is less than or equal to 40%, whereas 50% or more is required by the U.S. Tax Code. The Internal Revenue Service prohibits the improper of dividends, which refers to a corporation's retention of undistributed profits to assist shareholders in avoiding their personal income tax on dividends. The IRS imposes a penalty if corporations accumulate more than Suppose you want to invest $10,000. You have two options: Option #1: Invest in municipal bonds with an expected return of 10.00%, or Option #2: Invest in the corporate bonds of Jefferson & Alexander Inc. which are offering an expected return of 12.50% Assume that your decision is based solely on your tax situation. If everything else is the same for both bonds, at what tax rate would you be indifferent between these two bond investments