Subchapter S corporation
S Corporation Owner Who Didn’t Receive Distribution Subject to Tax
Taxpayers who own an interest in an S corporation but who are not familiar with the tax rules are often surprised to learn that they have to pay tax on the business profits even if they do not receive distributions from the business. The court recently addressed this fundamental concept in Dalton v. Commissioner, T.C. […]
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S Corporation Owner Subject to Self-Employment Tax
Taxpayers often establish Subchapter S corporations to avoid Social Security and Medicare taxes on a portion of their earnings. This is a very common arrangement. In Fleischer v. Commissioner, T.C. Memo. 2016-238, the taxpayer was not able to avoid these taxes using a Subchapter S corporation. The case provides an example of how the Subchapter […]
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