SEE-2 - Business Entities and Considerations - Section 1.3

Apply C corporation formation and taxation rules, including the Section 351 nonrecognition rule, the flat corporate tax rate, and dividend and earnings-and-profits treatment.

Apply the Section 351 rule that property transferred to a controlled corporation (80% control immediately after) is generally tax-free, and compute corporate taxable income at the flat 21% rate on Form 1120. Recognise that distributions to shareholders are dividends to the extent of earnings and profits, that C corporation income is taxed twice, and how the dividends-received deduction reduces tax on inter-corporate dividends.

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