How Do Corporate Income Taxes Modify MM's Leverage Irrelevance Proposition

How do corporate income taxes modify MM's leverage irrelevance proposition?
D. Future interest tax shields are usually valued by discounting at the borrowing rate r_debt. In the special case of permanent debt,
PV tax shield = T_c (r_debt * D)/r_debt = T_cD
Of course interest tax shields are valuable only for companies that are making profits and paying taxes.

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Debt interest is a tax-deductible expens...

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