WebApr 25, 2024 · For a grantor trust to qualify as an eligible shareholder of an S corporation, the grantor (or a trust beneficiary if Sec. 678 applies) must be the deemed owner of the … Webcharitable lead trust can own S stock, and illustrates a novel way of obtaining grantor trust income tax treatment. It raises concerns, however, about what happens when the grantor dies before the trust terminates, and whether S stock is appropriate when the grantor wishes to avoid later taxes on trust income. Therefore, S stock remains a problem
How a Grantor Trust Works - SmartAsset
WebA GRAT is a specialized trust used to transfer assets, including stock, to family members in trust. If the GRAT is drafted properly, it can be a qualified S-Corporation shareholder … WebIn general, living trusts and testamentary trusts may hold S corporation stock only for two (2) years after the date of death of the grantor. After death, the trusts become ineligible … captain georges price for buffet
Be Careful with Living Trusts that Our S Corporation Stock
WebJan 7, 2024 · For purposes of ensuring that a grantor trust qualifies as an S shareholder, confirm that the grantor owns the entire trust. ... Respect the rule that a testamentary trust can only hold S ... WebIf the trust was not originally drafted with the intent of being an eligible S corporation shareholder but continues to hold the stock, the corporation could be prevented from … WebDec 2, 2013 · Upon the death of the deemed owner of the grantor trust, if the trust was a grantor trust immediately before the death, and it continues in existence after the death, the trust may continue to hold S corporation stock, but only for the 2-year period beginning on the day of the deemed owner’s death. captain george\u0027s brighton