Corporate dividends are:

A. taxable income of the recipient even though that income was previously taxed.

B. tax-free since the corporation pays tax on that income when it is earned.

C. tax-free because they are distributions of aftertax income. tax-free because the income is taxed at the personal level when earned by the firm.

D. taxed at both the corporate and the personal level when the dividends are paid to shareholders.