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Which of the following will prevent a corporation from being a proper S corporation? a. 101...

Which of the following will prevent a corporation from being a proper S corporation?

a.

101 shareholders which include a married couple

c.

A shareholder who lives in France but is a U.S. citizen

b.

Outstanding class A voting common stock and class B non-voting common stock

d.

A shareholder sells his stock to the PX partnership
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Answer #1

ANSWER B . OUTSTANDING CLASS A VOTING STOCK AND CLASS NON VOTING STOCK

D. SHAREHOLDER SELLS HIS STOCK TO PX PARTNERSHIP

REQUIREMENT TO BE S CORPORATION

1. NO MORE THAN 100 SHAREHOLDERS ( COUPLE COUNTED AS SINGLE SHAREHOLDER, THEREBY IN THIS CASE THERE ARE ONLY 100 SHAREHOLDERS AS MARIIED COUPLE IS 1)

2. ONLY ONE CLASS OF STOCK ( IN THIS CASE, THERE ARE 2 CLASSES OF SHARES)

3. SHAREHOLDER CAN E AN INDIVIDUAL, ESTATE OR TRUST ( PARTNERSHIP CANNOT BE SHAREHOLDER)

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