What are constructive dividends?

What are constructive dividends?

Respond to the following:

Explain the concept of constructive dividends. Give examples.
Construct three original examples of situations in which the IRS might claim constructive dividends.
Suggest ways to ensure that constructive dividends are minimized or eliminated.
Write a three- to five-page paper in MS Word format. Apply APA standards for writing style to your work.

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Constructive Dividends
Constructive dividends represent payments, loans or allowances made to shareholders. However, these payments are not intended to be dividend payments, but they end up being classified as dividends by IRS. Constructive dividends are often not declared as dividends by the organization’s Board of Directors, and they are also termed as disguised dividends.

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