Which of the following is correct regarding the payment of dividends by a corporation?

They Dividends are paid out of net after-tax income and thus are not tax deductible by the corporation.

Dividends are paid out of net after-tax income and thus are tax deductible by the corporation in the following tax year.

Dividends are tax deductible by the corporation once they have been declared.

If dividends are paid after-tax bond interest they are tax deductible by the corporation.