Discussion:S-Corp 1,000 shares originally authorized - calling those shares in
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Discussion Forum Index --> Basic Tax Questions --> S-Corp 1,000 shares originally authorized - calling those shares in
Discussion Forum Index --> Tax Questions --> S-Corp 1,000 shares originally authorized - calling those shares in
| 9 January 2008 | |
| Attorney and client want to call in 51 and 49 shares that were originally issued; 1,000 shares were authorized.
They want to reauthorize 100,000 shares and actually issue 40,000 shares and reshuffle the stock ownership by adding 2 new shareholders. They are going to issue 51% of the issued shares to the original 51% owner, the 49% owner will now own only 24%. The new shareholders will receive 20% and 5% shares for $100 each in consideration. The company is currently worth zero, so the new shareholders are not profiting in any way immediately, only hopeful for potential growth under new management expertise they offer to the corp. Is the $200 received by the corp considered a sale of the original 49% owners shares? The attorney was using the term "stock split", however the 49% owner is going to recognize a lower ownership standing after the stocks are reissued. It would seem logical that the 49% shareholder sold his shares for $200, correct? Thanks. | |
| 9 January 2008 | |
| Randy, the old shareholder will own a smaller percentage of a bigger company - the new shareholder will be paying cash for his shares, correct? Or will the new shareholder receive shares in exchange for services? | |
