Legal Question in Tax Law in New Jersey

Re: Second class of stock under 26 USC 1361(b)(1)(D)

Anything other than stipping the stock of voting rights will generally be considered a 2nd class of stock. Nevertheless, the facts and circumstances control. It sounds like you should consider converting to a limited liability company.

Ronald J. Cappuccio, J.D., LL.M.(Tax)

Counsellor at Law

(856) 665-2121

http://www.taxesq.com/

Re: Second class of stock under 26 USC 1361(b)(1)(D)

Are you merely asking what is a stock class? Typically different classes of stock are controlled by such features as different voting rights (non-voting versus voting shares), conversion features (Class B can be converted into 10 shares of Class A shares whenever someone wants), priority of dividend for example: preferred stock that gets all their dividends paid before any common stock gets any.

Re: Second class of stock under 26 USC 1361(b)(1)(D)

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