Posted November 23, 2018
When you revoke S corporation status, you will trigger a taxable event. A potentially big one. Upon revocation, assets are distributed to the S Corp shareholders at fair market value. Cash is easy. An automobile is generally not a big deal. But real estate can kick your butt. Therefore, before we put out the flame a review of the assets and fair market values must be done. To pay capital gains on appreciated assets when you have cash from a transaction is easy. To pay capital gains on appreciated assets when a cashless revocation occurs is brutal.
Taxpayer’s Comprehensive Guide to LLCs and S Corps : 2019 Edition
This KB article is an excerpt from our book which is available in paperback from Amazon, as an eBook for Kindle and as a PDF from ClickBank. We used to publish with iTunes and Nook, but keeping up with two different formats was brutal. You can cruise through these KB articles, click on the fancy buttons below or visit our webpage which provides more information at-