Video: Dividend Received Deduction

In this lesson, Nick Palazzolo, CPA, breaks down the dividends received deduction (DRD), a pivotal tax provision that helps C-Corporations avoid triple taxation by excluding a portion of their received dividends from taxable income. With great enthusiasm, Nick demystifies the DRD rates and limitations, urging to commit them to memory as they are essential for the exam. He walks through illustrative examples, highlighting the application of DRD based on varying ownership percentages and how it interacts with taxable income and net operating losses. Emphasizing practical scenarios, Nick clarifies the conditions under which the DRD can be applied, including the roles of personal service corporations, personal holding companies, and S-Corporations, making sure all bases are covered to equip for the real-world tasks of corporate taxation.