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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: J_F_Shepard who wrote (172442)	1/10/2003 9:42:59 AM
From: willcousa	Read Replies (1) \| Respond to of 186894

Thanks for posting that article. Note that legally a company cannot pay a dividend (this has nothing to do with taxes but is a matter of corporate law and is the basis for how our tax law addresses dividends) unless it has earned surplus. Any payment to shareholders where there is no surplus is a return of capital invested. So companies already determine or calculate whether they can legally pay a dividend. For new issues of preferred stocks I would expect companies to structure them to qualify for dividend expemption or to favor issuing additional common stock. As you get into the details of this tax change I think you will find the whole program pretty clever in terms of its' economic effects.