S Corporation (Taxes)

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Subject Author Date S Corporation (Taxes) Bill Bowden 10-04-2009  Re: S Corporation (Taxes) removeps-groups@yahoo.com 10-04-2009  Re: S Corporation (Taxes) removeps-groups@yahoo.com 10-04-2009  Re: S Corporation (Taxes) paulthomascpa 10-05-2009  Re: S Corporation (Taxes) Stuart A. Bronstein 10-05-2009  Re: S Corporation (Taxes) HLunsford 10-05-2009  Re: S Corporation (Taxes) Bill Bowden 10-05-2009  Re: S Corporation (Taxes) Tom Russ 10-06-2009
Posted by Bill Bowden on October 4, 2009, 10:25 pm Please log in for more thread options I am a 50% passive owner and corporate officer of a S Corporation which has returned very little profit over 20 years. Currently, I am reporting a small income from the Corporation I have not received. I no longer want to be involved with a business, for which I receive no benefits and end up with a tax liability for income I never received. I'm not getting much help from others involved, and it seems difficult to just give away a losing investment, since nobody wants it. How can I get rid of a losing S Corporation investment, and get my name off the books, so I don't have to pay more taxes on income I never receive. I don't want to pursue collecting income due, I just want to get rid of the whole thing. Thanks, -Bill -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by removeps-groups@yahoo.com on October 4, 2009, 11:20 pm Please log in for more thread options > I am a 50% passive owner and corporate officer of a S Corporation > which has returned very little profit over 20 years. Currently, I am > reporting a small income from the Corporation I have not received. I > no longer want to be involved with a business, for which I receive no > benefits and end up with a tax liability for income I never received. > > I'm not getting much help from others involved, and it seems difficult > to just give away a losing investment, since nobody wants it. > > How can I get rid of a losing S Corporation investment, and get my > name off the books, so I don't have to pay more taxes on income I > never receive. I don't want to pursue collecting income due, I just > want to get rid of the whole thing. You have to find a buyer of your stock. There might be a special rule for disposing of worthless stock. Even though the corporation made some profit over the years and you paid taxes on it, but didn't see any of that money, the profit that the corporation made is added to your cost basis (based on the number of shares), so you will have a loss even if you sold the shares for the same price you bought them at. Generally you can get all the info you need to track your cost basis from the K-1 over the years. As a shareholder, you should be able to nominate a new board of directors -- maybe someone interested in liquidating the company. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by removeps-groups@yahoo.com on October 4, 2009, 11:21 pm Please log in for more thread options > I am a 50% passive owner and corporate officer of a S Corporation > which has returned very little profit over 20 years. Currently, I am > reporting a small income from the Corporation I have not received. I > no longer want to be involved with a business, for which I receive no > benefits and end up with a tax liability for income I never received. > > I'm not getting much help from others involved, and it seems difficult > to just give away a losing investment, since nobody wants it. > > How can I get rid of a losing S Corporation investment, and get my > name off the books, so I don't have to pay more taxes on income I > never receive. I don't want to pursue collecting income due, I just > want to get rid of the whole thing. Hit the Send button too soon. Maybe you can donate the shares to a 501 (c)(3) charity or the government. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by paulthomascpa on October 5, 2009, 8:19 am Please log in for more thread options >I am a 50% passive owner and corporate officer of a S Corporation > which has returned very little profit over 20 years. Currently, I am > reporting a small income from the Corporation I have not received. I > no longer want to be involved with a business, for which I receive no > benefits and end up with a tax liability for income I never received. > > I'm not getting much help from others involved, and it seems difficult > to just give away a losing investment, since nobody wants it. > > How can I get rid of a losing S Corporation investment, and get my > name off the books, so I don't have to pay more taxes on income I > never receive. I don't want to pursue collecting income due, I just > want to get rid of the whole thing. I'd start by making an offer to the other shareholders to buy you out, for a dollar or something like that. That gets you off the hook from that point forward. There may be limits on what else you could do with your shares set by the corporate documents. Often times limits are placed on shares in closely held companies. So look into that before you do anything else. -- Paul Thomas, CPA www.paulthomascpa.com -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Stuart A. Bronstein on October 5, 2009, 1:29 pm Please log in for more thread options > I am a 50% passive owner and corporate officer of a S > Corporation which has returned very little profit over 20 years. > Currently, I am reporting a small income from the Corporation I > have not received. I no longer want to be involved with a > business, for which I receive no benefits and end up with a tax > liability for income I never received. > > I'm not getting much help from others involved, and it seems > difficult to just give away a losing investment, since nobody > wants it. > > How can I get rid of a losing S Corporation investment, and get > my name off the books, so I don't have to pay more taxes on > income I never receive. I don't want to pursue collecting income > due, I just want to get rid of the whole thing. Being a substantial owner of the corporation may well give you rights of partition. In other words you can force the sale of the entire corporation, rather than just your portion. In that case you are more likely to end up with more money if the business is actually profitable. Since you may have to go to court to do if the other shareholders resist, it might be worth also suing for an accounting. You may have been short-changed over the years, and that would allow for you to receive what you should have. Check with a local business lawyer to see whether you can do that under the circumstances. -- Stu http://downtoearthlawyer.com -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Re: S Corporation Tax August 30, 2007, 11:20 pm S-Corporation in NYC January 26, 2008, 10:59 pm Nevada Corporation March 5, 2008, 4:30 pm gift to a corporation taxable? January 5, 2008, 4:39 pm Can an S-Corporation Pay Qualified Dividends? 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