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Dividends paid to policy 7 holders on participating policies are treated by the IRS as...

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Accounting

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Dividends paid to policy 7 holders on participating policies are treated by the IRS as a return of premium and are not subject to income tax. Dividends to shareholders in a stock company, however, are taxable income to the recipients. Do you believe this difference in treatment is justified? Why or why not? 7

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