Why might a small corporation organize as an S corporation? An S corporation (a) does not have to issue stock (b) is not subject to the corporate income tax (c) is the only form of business organization that offers limited liability (d) is the only form of business organization that provides unlimited life. 11. Double taxation refers to the fact that (a) corporations have to pay both state and federal taxes (b) the part of a corporation\'s earnings not distributed as dividends is subject to excess profits taxes (e) corporations pay both income taxes and sales taxes (d) corporations pay income taxes on their earnings, and the earnings that they distribute as dividends are subject to personal income taxes. Solution 10c11d .