Exempt organizations are still taxed on any business income. Income earned on contributions is not taxed. All income over said amount is not taxed. Before that, dividends were taxed as normal income. The annuity income will be taxed, though. When selling equipment, however, depreciation recapture is generally taxed as ordinary income, not capital gain. Originally the benefits received by retirees were not taxed as income. Distributions from partnerships are not taxed as dividends. Resident entities are taxed on worldwide income. Unrealized capital gains are not taxed. Share dividends are taxed at 28%. Thus, income is taxed at the shareholder level and not at the corporate level. Therefore, partners are taxed on the income of their partnership. Individuals are often taxed at different rates than corporations. Residents are generally taxed differently from nonresidents.