Legal Question in Tax Law in Texas

Stock

I want to know what happen If:

I have a S corporation that was formed in 1984 by 10

unrelated individual investors and that the company

suffered losses in its early years but know is OK.

Over the years the shareholders have gifted shares to

their children and transfered them to trusts for their

grandchildre. at the end of the las year, there were

50 chareholdes. additional gifted made have increased

the number of shareholders to 70. the company needs

more cash and would like to sell additional shares,

the investors should be advised of the tax implication

of issuing additional shares of stock????? I want

to know what you recommended to do in this situations.

Thanks very much


Asked on 5/01/02, 12:01 pm

1 Answer from Attorneys
Lawrence Graves Coolidge & Graves PLLC

Re: Stock

Sounds like a mess, and it is possible that the Subchapter S status has already been compromised. I have a good firm that I can recommend in Dallas if you contact me.

Best wishes,

LDWG

Read more
Answered on 5/01/02, 12:10 pm


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