Category: Business Entities and Transactions

The IRS issued Rev. Proc. 2022-19, which provides simplified procedures for S corporations and their shareholders to resolve six frequently-encountered issues. For these issues, Rev. Proc. 2022-19 allows S corporations and their shareholders to obtain relief without requesting a private letter ruling (PLR). The IRS identified these issues as not…

When a business owner receives a letter of intent from a buyer to purchase their business, the business owner may be surprised to learn that the transaction is contingent on the underlying business entity engaging in an “F” reorganization.  The business owner may be curious as to why a potential…

A formal definition of a “close” corporation reads a “corporation [that] does not exceed a statutorily defined number of shareholders and is not a public corporation… The main benefit of a close corporation is that it will be exempt from a number of the formal rules which usually govern corporations.”…

The first thing to understand about corporations is that they are separate legal entities, apart from their shareholders, who are the owners. Because of this, corporations have “perpetual existence.” A corporation’s existence goes on after a shareholder, even a majority shareholder, dies or otherwise leaves the company.  If your corporation…

An S-Corp is a type of corporation that allows shareholders to enjoy the typical benefits of incorporation along with the benefits of “pass-through” taxation, which means that the corporation itself is not taxed, and shareholders are instead taxed at the personal income level. In other words, the shareholders are not…