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Zecco.com » General Investing » Tax Matters » Buying stocks via s-corp?
Last post 04-07-2008, 4:18 PM by NCWV. 1 replies.
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  •  02-25-2008, 8:28 PM 24125

    Buying stocks via s-corp?

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    Are there and advantages / disadvantges by investing thru my small biz (s-corp) vs as an indivdual investor?

  •  04-07-2008, 4:18 PM 26529 in reply to 24125

    Re: Buying stocks via s-corp?

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    There are not really any advantages gained by investing your money in an S-corp because all earnings pass through. Also, IRS Sec. 1375 imposes an additional tax on S corporations that have passive investment income when the corporation has (1) accumulated earnings and profits (E&P) at the close of a tax year; and (2) gross receipts, more than 25% of which are PII (i.e., royalties, rents, dividends, interest, annuities and net gains on sales or exchanges of stock in securities).

    So your investment income must be lower than 25% of gross receipts and it has to be paid out at the end of the year to avoid any additonal taxes.
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