Home Q&A Forum S corp and corporate restructuring?
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Corporate

S Corp

California

Asked on Jun 19, 2023

S corp and corporate restructuring?

I am looking to restructure my business, which is incorporated as an S corp. I am looking for advice on how to best restructure the business to ensure that all legal requirements are met and that the new structure is advantageous for the business. I am considering various options such as merging with another business, changing the ownership structure, or forming a new entity. I am seeking legal advice on the best approach and the potential implications of each option.

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Answer

Corporate

California

Answered 1006 days ago

Chris J.

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August 22, 2021

Hi: Generally speaking, you have several options (many of which you've identified). 1. You can revoke S-Corp status (if you have a corporation and want C-Corp status). However, revocation won't be effective until the 2024 tax year. With that said, sometimes people inadvertently revoke S-Corp status by taking certain actions (which we can discuss). 2. You can create a new entity and structure it in the way you want (corporation, LLC, partnership, etc.). Then, you can wind down the S-Corp. 3. You can merge your existing S-Corp into an entity and have that entity survive and your S-Corp "merge out" and disappear. The approach that makes the most sense depends upon your business, the assets held by your S-Corp, and your objectives. Best regards, Chris Jackson

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