Problem
Marathon Inc. (a C corporation) reported $500,000 of taxable income in the current year. During the current year, it distributed $50,000 as dividends to its shareholders as follows: $15,000 to Guy an individual shareholder. $ 5,000 to Little Rock Corp. a 10% shareholder (C corporation) $30,000 to other shareholders. How much of the dividend payment did Marathon deduct in determining its taxable income? Same facts as Question 7 above. Assuming Guy's marginal ordinary tax rate is 37%, how much tax will he pay on the dividend he received from Marathon Inc. (including the net investment income tax)?