Issues with Living Trusts that own S-Corporation Stock

Although a trust can be a permitted shareholder in an S corporation, only certain kinds of trusts are so permitted under Section 1361 of the Internal Revenue Code. If a trust is not one of the trusts specifically authorized by the Internal Revenue Code, however, and becomes a shareholder, the Corporation ceases to be a qualified S corporation and will be taxed as an ordinary C corporation. Thus, when a Living Trust becomes the owner of S corporation stock, there can be resulting difficulties for both the Grantor’s heirs and for the S corporation itself if an estate lawyer is not involved.

Learn more in this episode of The Bottled Business Sense Show.

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WFB LEGAL CONSULTING–LAWYER FOR BUSINESS–A BEST ASSET PROTECTION Services Group

Bill Bernard – WFBLegalConsulting.com [email protected] 949.698.6222

Rick Moscoso – Captivate365.com [email protected] 949.667.1182

The Bottled Business Sense Show provides practical business perspectives that uniquely emphasize both legal and media marketing strategies that protect and insure the longevity of your business.

WFB LEGAL CONSULTING–LAWYER FOR BUSINESS–A BEST ASSET PROTECTION Services Group

http://bottledbusinesssenseshow.com