Will the following events cause an S election to terminate a The S corporation earning 100 of its gross receipts in its first tax year from passive sources b The S corporation issuing nonvoting stock that has a dividend preference c The S corporation purchasing 100 of the single class of stock of a...

a No The passive income will not terminate the S election because the corporation has no Subchapter ...

Will the following events cause an S election to terminate? a. The S corporation earning 100% of

Question:

Will the following events cause an S election to terminate?
a. The S earning 100% of its gross receipts in its first tax year from passive sources
b. The S issuing nonvoting stock that has a preference
c. The S purchasing 100% of the single class of stock of a second domestic that has conducted business activities for four years
d. An individual shareholder donating 100 shares of S stock to a charity that is exempt from tax under Sec. 501(c)(3)
e. The S earning tax-exempt interest income Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...