Avoiding Tax Pitfalls in C Corp to S Corp Elections: Built-in-Gains, Earnings and Profits, Passive Income, and Other Issues
Recording of a 110-minute CPE webinar with Q&A
This webinar will equip tax counsel and advisers with the tools to advise C Corporation clients of the benefits and potential tax drawbacks of terminating C Corp status in favor of making an S election. The panel will dissect the necessary considerations involved and outline ways to minimize potentially negative tax consequences involved in an S conversion.
- Tax efficiencies and limitations of an S Corporation conversion
- Elimination of corporate layer of tax
- S Corporations and LLCs
- Pre-conversion factors to consider in advising clients
- 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 a liquidation and re-incorporation into an LLC?
- What are the major tax traps that must be identified before converting from a C Corporation into an S Corporation?
- What steps can a C Corporation take prior to conversion to minimize or eliminate negative tax consequences from an S election?
- What calculations must a C Corporation make on assets and goodwill prior to making an S election?
- What implications may a conversion to an S-Corporation have in a subsequent disposition of the business?
Scott A. Harty
Alston & Bird
Mr. Harty focuses his practice on complex domestic and cross-border commercial transactions, including taxable and... | Read More
Mr. Harty focuses his practice on complex domestic and cross-border commercial transactions, including taxable and tax-free mergers and acquisitions, joint ventures and corporate restructurings. He has substantial experience advising corporate and private clients on all facets of U.S. inbound and outbound investments, including treaty planning, due diligence in acquisitions, investments in U.S. real estate, Subpart F and withholding tax issues arising under FATCA. He also represents clients in tax controversy matters through the audit process and administrative appeals, including the negotiation and settlement of taxes and civil penalties. He handles tax audits for public and private companies, income and gift tax audits for individuals and cases with significant offshore trust and foreign corporate tax issues.Close
L. Andrew Immerman
Alston & Bird
Mr. Immerman concentrates on federal income tax matters, including domestic and international tax planning and... | Read More
Mr. Immerman concentrates on federal income tax matters, including domestic and international tax planning and transactional work for joint ventures, partnerships, limited liability companies and corporations. He has helped structure many sophisticated partnership and limited liability company transactions and has represented the target or the acquirer in numerous corporate mergers and acquisitions.Close
Allen Magee, CPA
Dixon Hughes Goodman
Mr. Magee focuses on providing tax compliance and consulting services to public and private companies in a variety of... | Read More
Mr. Magee focuses on providing tax compliance and consulting services to public and private companies in a variety of industries, including manufacturing, distribution, automotive dealerships, restaurant groups, real estate, and technology companies. His public company practice focuses primarily on tax consulting and compliance surrounding income tax issues facing multi-state and consolidated corporate groups. He also has extensive experience assisting clients in the preparation of quarterly and annual estimated tax accruals (ASC 740). He also concentrates his tax consulting and compliance experience in dealing with the income tax flow-through entity issues for multi-state S corporations, partnerships, and their respective investors. He has extensive experience in assisting many private businesses with the tax planning issues related to selling their businesses to outside investors.Close