The tax system - Understanding Taxes

The tax system Which source of investor income is susceptible to double taxation? Interest earned Dividends You bought 1,000 shares of Tund Corp. stock for $60.59 per share and sold it for $82.35 per share after a few years. How will your gain or loss be treated when you file your taxes? As a capital gain taxed at the long-term tax rate As a capital gain taxed at the current ordinary-income tax rate Depreciation expenses directly affect a company's taxable income. An increase in depreciation expense will lead to a taxable income. It will tax deducted from a company's earnings, thus leading to a operating cash flow. According to a tax law established in 1969, taxpayers must pay the of the Alternative Minimum Tax (AMT) or regular tax. Which of the following cash outflows cannot be deducted from the operating income to derive the taxable income? Dividends paid Interest paid