Who can I sell my S Corp stock to?
In this audio snippet, you'll hear about:
- Anyone, but if you sell to non–US citizen or more than 100 people you will no longer be classified as an S Corp
Audio Transcript
Travis:
Who can I sell my S corp. stock to?
Yosef:
Well you can sell your corporation stock to anybody. But that won't
necessarily ensure that you'll remain an S corporation afterwards.
Travis:
Oh, interesting.
Yosef:
Again, as noted earlier: the shareholders in an S corporation have to
be United States residents. The minute you sell it to a non–US resident
you're going to have a problem.
Travis:
That makes sense.
Yosef:
Or the minute that you sell your shares to another S corporation
with... I mean let's say you've got 50 shareholders in your
corporation, and then you sell to another S corporation that has
another 50 shareholders. You may suddenly even exceed the 100
shareholder mark and that could be a very big problem.
Travis:
OK.
Yosef:
But again, the idea of Subchapter S is that S is small. It's supposed to be small corporations, not big ones.
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