Which of the following deductions can a corporation claim to reduce taxable income?

The deduction for employee salaries is a key deduction that corporations can claim to reduce their taxable income. This is because employee salaries are considered ordinary and necessary business expenses incurred in the process of generating income. By deducting salaries, a corporation lowers its overall taxable income, which can lead to a reduced tax liability. The rationale behind this deduction is to encourage businesses to fairly compensate their employees, which in turn can promote overall economic activity.

Other options do not qualify as appropriate deductions for reducing taxable income in a corporate context. Personal expenses of an owner are not deductible because they do not relate to the business operations and hence cannot be considered necessary for the generation of business income. While state taxes paid are a business expense that might be deductible under certain conditions, they do not encompass all the relevant expenses that can be deducted. Hence, the only deduction listed that is allowable and commonly utilized by corporations to reduce taxable income is employee salaries.