With a corporation, you have three choices on how to be taxed. One, you can pay yourself a salary up to any amount, even potentially making a loss for the corp

With a corporation, you have three choices on how to be taxed. One, you can pay yourself a salary up to any amount, even potentially making a loss for the corporation (as long as someone will give you the money to stay solvent). That salary is an expense for the company, so you won't pay corporate tax on that amount. You'll then have to pay personal income tax, as well as payroll tax and probably some unemployment insurance and other fees on that. Two, you can distribute money to yourself as dividends. Dividends are cash-neutral to the corporation, so they won't deduct from the company's tax liability. Usually they come out of profits, so indeed they are post-tax money. Whomever receives the dividends will pay personal income tax on them, but at a lower rate than most people's tax on wage income (often much lower). Third, the corporation can hold all of the profits internally, which will increase the value of the company, and thus the shares held by the owners. The shareowners can eventually sell those shares for a profit, which will be taxed as long-term cap gains if held more than a year. In brief, yes, there is double taxation, in the sense that income is taxed more than once, but it's not taxed at the full rate used for wages both times, and it's possible to defer that second tax bill indefinitely.