For companies that comprise an affiliated group, a benefit associated with the filing of a consolidated tax return is that:

Multiple Choice

intercompany profits are taxed before they are realized.

intercompany dividends are taxed at a lower rate that applies to all dividends between members of an affiliated group, regardless of whether a consolidated return is filed.

intercompany profits are never taxed, even when they are realized.

intercompany profits may be taxed twice in certain cases.

losses incurred by one affiliated company can be used to reduce taxable income earned by other members of that group.