The most popular form of business entity is the S corporation. S corporations create special reporting and transactional issues because they follow the “entity” approach applicable to all corporations. The tax result can be a combination of provisions found in subchapter C and subchapter S. For this reason, although both partnerships and S corporations are flow through entities, the tax result of similar transactions can be very different in the two entity types.
This session is “Part II” of a two-part program on the taxation of S corporations and their shareholders. This session will examine more complex transactional issues that arise in S corporations. It will help both staff and management for dealing with more complex tax concepts applicable to both S corporations and their shareholders.
In this four-hour course nationally recognized tax expert and instructor James Hamill, CPA, Ph.D., will explain the best tax-planning strategies for S corporations. The session will also address higher-level transactional issues and is appropriate for someone who has taken the first part of this series or who has equivalent experience with S corporations.
Publication Date: December 2021
Designed For
CPAs, EAs, tax preparers and other tax professionals with responsibility for assisting clients with partnership tax returns and tax-planning strategies.
Topics Covered
- Purchase or sale of S corporations
- Liquidations of S corporations
- Special QBID reporting issues and planning
- Section 338(h)(10) elections — why, how, and the effect
- Section 336(e) elections — why, how, and the effect
- QSub treatment and uses
- F" reorganizations involving S corporations — why. how, and the effect
- Corporate-level taxes
- Passive income issues
- S corporation reorganization
Learning Objectives
- Recognize how to assist clients in exit from an S corporation
- Identify issues that arise when stock is purchased or sold
- Identify how to plan for special installment sale rules for asset sales
- Determine the optimal way to treat a stock purchase as an asset purchase
- Identify risks of a corporate-level tax applying to an S corporation
- Determine issues that may terminate an S election
- Identify what requires that gain and loss be recognized as if property is sold to the distributee at FMV for liquidating distributions
- Recognize what applies if the entity has E&P
- Identify the second basis adjustment
- Recognize which type of debt is the most significant distinction between basis in an S corporation and basis in a partnership
- Differentiate which IRC Section relates to basis from inheritance
- Identify how many separate basis computations must S Corp Shareholders track
- Recognize which type of basis is created only for direct loans from the shareholder to the corporation
- Identify the maximum deduction (with AGI phaseout) for "active" real estate
Level
Intermediate
Instructional Method
Self-Study
NASBA Field of Study
Taxes (4 hours)
Program Prerequisites
Basic understanding of S corporation taxation.
Advance Preparation
None
Instructor
James R. Hamill
Dr. Hamill is the Director of Tax Practice at Reynolds, Hix & Co., P.A., in Albuquerque, New Mexico. He is the author of more than 36 CPE courses and more than 100 articles in professional tax journals and writes a weekly column on tax issues for the Albuquerque Journal. He has lectured on structuring tax transactions throughout the country for international CPA firms, State CPA Societies, and numerous other organizations. He has developed and instructed webinars on a variety of tax topics over the past 10 years. He is a CPA in New Mexico, a past Chair of the New Mexico Society of CPAs, and has 40 years of experience in tax practice.