Can a trust be a shareholder in an S corporation?

As an initial matter, as long as the business owner is living, his or her revocable trust is treated as a “grantor trust” for income tax purposes, and as such, is an eligible S corporation shareholder.

Should my trust own my S corp?

The fundamental problem is that trusts and S corporations do not play well together. Although a trust (including a Living 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.

What type of trusts can own S Corp stock?

TRUSTS COMMONLY USED TO HOLD S CORPORATION STOCK Three commonly used types of ongoing trusts qualify as S corporation shareholders: grantor trusts, qualified subchapter S trusts (QSSTs) and electing small business trusts (ESBTs).

Can an irrevocable trust own shares in an S Corp?

An irrevocable trust that is setup as a grantor trust, qualified subchapter S trust or as an electing small business trust may own shares of an S corporation.

Can an S corp be owned by a revocable trust?

Since a revocable trust is not treated as separate from the grantor, it is an eligible S corporation shareholder while the grantor is alive.

Can a slat own S Corp stock?

Con- sequently, planning with an IDIT, GRAT, or SLAT can be done with S corporation stock because these trusts are all grantor trusts. The planner must, however, have an exit strategy because grantor trust status is not permanent.

Can an S-Corp be owned by a revocable trust?

How do I transfer my S-Corp shares to a trust?

You can put your S-Corp into your living trust by simply transferring your shares ownership to yourself as trustee of your living trust, but again, there are certain procedures that must be strictly followed….These trusts include:

  1. Electing small business trusts (ESBT)
  2. Grantor trusts.
  3. Qualified subchapter S trusts (QSST)

How do I transfer my S corp shares to a trust?

Can a revocable trust own S corporation stock?

How do I transfer my S Corp shares to a trust?

Can a slat own S-Corp stock?

Categories: Interesting