Avoiding Tax Pitfalls in C Corp to S Corp Elections: Built-in-Gains, Earnings and Profits, Passive Income
Note: CLE credit is not offered on this program
Recording of a 110-minute CPE webinar with Q&A
This course will equip tax counsel and advisers with the tools to advise C corporation clients on the potential tax benefits and drawbacks of terminating C corp status in favor of making an S election in light of the new tax law. The panel will dissect the necessary considerations involved and outline ways to minimize adverse tax consequences involved in making the election.
- Tax efficiencies and limitations of an S corporation conversion
- Elimination of the corporate layer of tax
- S corporations and LLCs
- Pre-conversion factors to consider in advising clients
- C corporation vs. S corporation tax rate differential after the new tax law
- Built-in gains tax
- Tax on excess passive income
- Tax on certain accumulated earnings and profits
- Treatment of existing corporate net operating losses
- Planning opportunities
- Timing of disposition of Section 1374 assets
- Pre-conversion distribution of earnings and profits
The panel will address these and other relevant questions:
- When is conversion to an S corporation more beneficial than liquidation and re-incorporation into an LLC?
- What are the primary tax traps to recognize before converting from a C corporation into an S corporation?
- What steps can a C corporation take before conversion to minimize or eliminate negative tax consequences from an S election?
- What calculations must a C corporation make on assets and goodwill before making an S election?
- What implications may a conversion to an S corporation have in a subsequent disposition of the business?
- How the IRS plans to raise awareness of and increase compliance with the requirements of Section 1374.
- What are other factors to consider in S conversions in light of the new tax law?
Marcus E. Dyer, CPA, JD
Team Leader of Tax Controversy
Mr. Dyer manages and reviews all aspects of federal and state tax compliance for C-corporation, S corporation and... | Read More
Mr. Dyer manages and reviews all aspects of federal and state tax compliance for C-corporation, S corporation and partnership returns, including consolidated C-corporation returns. He advises businesses on a wide array of tax matters including but not limited to reorganizations and employee benefits. He manages and reviews all aspects of the preparation of high net worth individual returns and conducts tax research on federal and state tax issues. He also handles tax controversies, including at the examination, appeals and collections stages.Close
Daniel Mayo, J.D., LL.M.
Mr. Mayo has more than 20 years of professional tax experience as well as experience in federal, international and... | Read More
Mr. Mayo has more than 20 years of professional tax experience as well as experience in federal, international and financial products taxation. He is a member of Withum’s National Tax Services Group and oversees the U.S. Federal income tax research, planning and review functions. Mr. Mayo is experienced in mergers and acquisitions, capital markets and cross-border transactions.Close