S Corporation With Respect to Wages and Distributions to Shareholder Employees Essay

Pages: 2 (597 words)  ·  Bibliography Sources: 2  ·  File: .docx  ·  Level: College Junior  ·  Topic: Economics

¶ … Corporation

Ethical Issues with S corporations

S corporations are the type of businesses or corporations that choose to have the individual shareholders bear the income, the deductions, losses as well as credit for the purpose of the taxation process by the federal authorities. In such a corporation, the shareholders are responsible for reporting the flow-through of the losses as well as the income during the filing of their personal tax returns and hence their taxes are assessed at the individual income tax rates. This method of taxation allows the corporation to avoid double taxation on the corporate income. The S corporation is also responsible for taxes on certain passive incomes as well as built-in gains (IRS, 2012).

There are certain characteristics or conditions that have to be in place in order to qualify for S corporation status; it has to be a domestic corporation. It must have only the allowable shareholders (which include individuals, trusts and estates. Partnerships, alien shareholders and corporations are not included here). It must have no more than 100 shareholders. Must have only one class of stock and must not be an ineligible corporation like insurance companies, financial institutions and domestic international sales corporations. The corporation must then apply for this status by submitting Form 2553 duly filled and signed by all shareholders.

Ethical issues

Buy full Download Microsoft Word File paper
for $19.77
Bearing the fact that the taxation is based on individual tax returns, the individual shareholders can be made to unfairly bear the losses as precipitated by another or other individuals in the running of the corporation. This may be in the form of negligence in management or oversight in key issues, hence spreading the effect to other shareholders who did not participate in the mess.

Essay on S Corporation With Respect to Wages and Distributions to Shareholder Employees Assignment

The other ethical issue concerns the taxation on the wages of the… [END OF PREVIEW] . . . READ MORE

Two Ordering Options:

?
Which Option Should I Choose?
1.  Buy full paper (2 pages)Download Microsoft Word File

Download the perfectly formatted MS Word file!

- or -

2.  Write a NEW paper for me!✍🏻

We'll follow your exact instructions!
Chat with the writer 24/7.

Walmart How the Corporation Affects the American Economy Term Paper


Integrated Corporate Communication Dissertation


World Poor Thesis


Ford Motor Group Thesis


Environmental Sustainability Has Been Increasingly Embraced Dissertation


View 200+ other related papers  >>

How to Cite "S Corporation With Respect to Wages and Distributions to Shareholder Employees" Essay in a Bibliography:

APA Style

S Corporation With Respect to Wages and Distributions to Shareholder Employees.  (2012, July 25).  Retrieved June 2, 2020, from https://www.essaytown.com/subjects/paper/s-corporation-respect-wages-distributions/9316947

MLA Format

"S Corporation With Respect to Wages and Distributions to Shareholder Employees."  25 July 2012.  Web.  2 June 2020. <https://www.essaytown.com/subjects/paper/s-corporation-respect-wages-distributions/9316947>.

Chicago Style

"S Corporation With Respect to Wages and Distributions to Shareholder Employees."  Essaytown.com.  July 25, 2012.  Accessed June 2, 2020.
https://www.essaytown.com/subjects/paper/s-corporation-respect-wages-distributions/9316947.